EXHIBIT 10.11

 

 

July 11, 2005

 

Mr. Constantine S. Macricostas

5509 Pennock Point Road

Jupiter, FL 33458

 

RE: Consulting Agreement

 

Dear Deno:

 

This letter confirms that Photronics, Inc. (the “Company”) has agreed to continue to retain you as a Consultant in accordance with the terms of this letter. This Agreement is extended to you because of your importance as the Chief Executive Officer of the Company and our desire to retain your counsel after your retirement.

 

Accordingly, you shall continue to be retained, and you agree to serve, as a consultant. In order to retire from the Company, you must be at least 55 years of age and have been employed by the Company for at least 20 years, which criteria you have satisfied. The consulting relationship shall continue for a period of seven (7) years after the date of this letter (the “Consulting Period”).

 

1) Consulting Services

 

You shall provide consulting services to the Company in any area of your expertise upon request by a duly authorized officer of the Company, and such services shall be provided at such times, locations (provided that travel to any location not reasonably proximate to either Brookfield, Connecticut or your then current residence shall be at the expense of the Company) and by such means as reasonably required by the Company. You shall make yourself available to provide such services for up to ten (10) hours per month throughout the Consulting Period.

 

2) Compensation

 

As compensation for your services during the Consulting Period, the Company agrees to provide you with consulting fees and benefits under the terms specified below:

 

a)

Fees: In consideration for your consulting services, the Company will pay you consulting fees in the amount of two hundred and fifty thousand dollars ($250,000) per year (“Consulting Fees”). The Company shall pay you the Consulting Fees in equal monthly payments of twenty thousand, eight hundred and thirty-three dollars and thirty-three cents ($20,833.33) throughout the Consulting Period.

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b)

Taxes and Withholding: As a Consultant, you will comply with all applicable State and Federal laws governing self-employed individuals, including obligations such as quarterly payment of estimated taxes, social security, disability and other contributions based on the fees paid to you by the Company under this Agreement. The Company will not withhold or make payments for State or Federal income tax or Social Security, make employment insurance or disability insurance contributions, or obtain workers’ compensation insurance on your behalf. You hereby indemnify and defend the Company against any and all such taxes or contributions.

 

c)

Health Insurance: To the extent permitted by law and by the Company’s group health insurance policies, during the Consulting Period you and your spouse will continue to be covered by the Company’s health insurance benefits until January 1, 2006. Thereafter, the Company will provide you with supplemental health coverage, provided that the premiums payable by the Company shall not exceed $10,000 per year. If premiums exceed that amount, then you may wish to reimburse the Company for such excess if you wish to continue such coverage.

 

3) Limitations on Authority

 

You shall have no responsibilities as a Consultant to the Company other than as provided for above, and you shall not represent or purport to represent the Company in any manner whatsoever to any third party unless authorized by the Company in writing to do so.

 

4) Non-Competition and Non-Solicitation

 

You hereby agree that during the Consulting Period, you will not, without first obtaining the Company’s prior written approval, directly or indirectly engage or prepare to engage in any activities in competition with the Company or accept employment, provide services to, or establish a business relationship with a business or individual engaged in or preparing to engage in competition with the Company. You are free to engage in other work or business activities during the Consulting Period so long as they are not competitive with the Company. For purposes of this paragraph the holding of less than one percent (1%) of the outstanding voting securities of any firm or business organization in competition with the Company shall not constitute activities or services precluded by this paragraph. You also agree that through the end of the Consulting Period and for one (1) year thereafter, you will not, either directly or through others, solicit or attempt to solicit any employee or other personnel of the Company to terminate his or her relationship with the Company or to become an employee, consultant or independent contractor to or for any other person or entity. Further, you agree not to disparage the Company in any manner likely to be harmful to the Company’s business reputation, or the personal or business reputation of the Company’s directors, shareholders or employees. You agree that the Consulting Fees adequately compensate you for the restrictions of this paragraph.

 

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5) Expenses

 

You are responsible to pay, without reimbursement, all reasonable and ordinary expenses you incur on behalf of the Company in order to fulfill your obligations hereunder. Notwithstanding the foregoing, in the event that the Company requests the Consultant to incur travel, entertainment or other expenses in connection with duties that extend beyond the ordinary course of the Consultant’s duties under this Agreement, then the Company and the Consultant shall discuss and agree in advance on the amount of such extraordinary expenses for which the Consultant will be reimbursed, and such extraordinary expenses will not be credited against the Consulting Fee otherwise payable under this Agreement.

 

6) Office Space

 

During the term of this Agreement, Company shall provide Consultant with office space suitable for Consultant to perform the Consulting Services, at the Company’s offices in Brookfield, CT. Such office space shall be in proximity to the Company’s offices for its executive officers.

 

7) Purchase of Automobile

 

Commencing February, 2003, Consultant has had use of a 2003 BMW 540i automobile owned by Company. On or after February 2007, Consultant shall have the right to purchase such automobile from the Company for book value.

 

8) Liquidated Damages/Specific Performance

 

a)

You agree that it would be impracticable or extremely difficult to ascertain the amount of actual damages caused by breach of paragraph (4), Non-Competition and Non-Solicitation, of this Agreement. Therefore, you agree that, in the event of such a breach, the Company will be entitled to withhold further payments of all Consulting Fees, recover all Consulting Fees already paid to you, and obtain such injunctive and other relief as appropriate.

 

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		You further agree that this liquidated damage provision represents reasonable compensation for the loss which would be incurred by the Company because of any such breach.
	b)	In the event you claim that the Company is in breach of this Agreement, in addition to any other remedies available to you, you shall be entitled to obtain specific performance of this Agreement.

 

c)

In the event either party litigates enforcement of this Agreement, the prevailing party shall be entitled to recover its reasonable attorneys’ fees and pre-judgment interest on amounts due but not paid. Interest shall be at a rate equal to two percent (2%) above the prime rate announced by the Company’s primary lender.

 

None of your interests under this letter, or any right to receive any payments or distribution hereunder, shall be subject in any manner to sale, transfer, assignment, pledge, attachment, garnishment or other alienation or encumbrance of any kind, nor may such interest or right to receive a payment or distribution be taken, voluntarily or involuntarily, for the satisfaction of the obligations or debts of, or other claims against you, including claims for alimony, support, separate maintenance and claims in bankruptcy proceedings.

 

If the foregoing accurately sets forth our Agreement, please so indicate by signing in the space provided below.

 

 

Agreed to and accepted by:

/s/ Constantine S. Macricostas

Constantine S. Macricostas

 

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Exhibit 10.14

LIMITED LIABILITY COMPANY

OPERATING AGREEMENT

OF

MP MASK TECHNOLOGY CENTER, LLC

a Delaware Limited Liability Company

MEMBERSHIP INTERESTS IN MP MASK TECHNOLOGY CENTER, LLC, A DELAWARE LIMITED LIABILITY COMPANY, HAVE NOT BEEN REGISTERED WITH OR QUALIFIED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY SECURITIES REGULATORY AUTHORITY OF ANY STATE. THE INTERESTS ARE BEING SOLD IN RELIANCE UPON EXEMPTIONS FROM SUCH REGISTRATION OR QUALIFICATION REQUIREMENTS. THE INTERESTS CANNOT BE SOLD, TRANSFERRED, ASSIGNED OR OTHERWISE DISPOSED OF EXCEPT IN COMPLIANCE WITH THE RESTRICTIONS ON TRANSFERABILITY CONTAINED IN THIS LIMITED LIABILITY COMPANY OPERATING AGREEMENT OF MP MASK TECHNOLOGY CENTER, LLC AND APPLICABLE FEDERAL AND STATE SECURITIES LAWS.

Dated as of May 5, 2006

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TABLE OF CONTENTS

			Page
ARTICLE 1.		ORGANIZATIONAL MATTERS	1
1.1		Continuation	1
1.2		Name	1
1.3		Principal Place of Business; Other Places of Business	2
1.4		Business Purpose	2
1.5		Designated Agent for Service of Process	2
1.6		Term	2
1.7		Objectives; Approved Technology	2
1.8		Transaction Documents	3
ARTICLE 2.		DEFINITIONS	3
ARTICLE 3.		CAPITAL; CAPITAL ACCOUNTS AND MEMBERS	14
3.1		Initial Capital Contributions of Members	14
3.2		Additional Capital Contributions by Members	14
3.3		Capital Accounts	14
3.4		Member Capital	15
3.5		Liability of Members	15
3.6		Certain Expenses	15
ARTICLE 4.		FINANCING OF THE COMPANY	15
4.1		Types of Financing	15
ARTICLE 5.		MANAGEMENT	17
5.1		Board of Managers	17
5.2		Number of Managers; Appointment of Managers	17
5.3		Effect of Reduction in Photronics' Percentage Interest on Photronics Managers	18
5.4		Effect of Reduction in Micron's Percentage Interest on Micron Managers	18
5.5		Chairman of the Board of Managers	19
5.6		Meetings of Members and of the Board of Managers; Quorum	19
5.7		Actions Requiring a Special Vote	21
5.8		Compensation of Managers	22
5.9		Other Activities	23
5.10		Accounting; Records and Reports	23
5.11		Indemnification and Liability of the Managers	25
5.12		General Manager	27
5.13		Technology Steering Committee	29
5.14		Non-Disclosure Agreement	29
5.15		Maintenance of Insurance	29
5.16		Related Party Agreements	29

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ARTICLE 6.		OPERATIONS	29
6.1		Headquarters	29
6.2		Surplus Equipment	30
6.3		Printability Studies	30
6.4		Operations Plan; Annual Budget	30
ARTICLE 7.		DISPOSITION AND TRANSFERS OF INTERESTS	30
7.1		Holding of Membership Interest	30
7.2		Transfer Moratorium	30
7.3		Purchase of Remaining Interest	30
7.4		Change in Control of Photronics	31
7.5		Purchase and Sale Agreement	31
ARTICLE 8.		DISSOLUTION, LIQUIDATION, AND TERMINATION OF THE COMPANY	32
8.1		Limitations	32
8.2		Exclusive Causes	32
8.3		Effect of Dissolution	33
8.4		No Capital Contribution Upon Dissolution	33
8.5		Liquidation	34
ARTICLE 9.		DISTRIBUTIONS	35
9.1		Distributions of Cash Available for Distribution	35
9.2		Distributions Upon Liquidation	35
9.3		Withholding	35
9.4		Distributions in Kind	36
9.5		Limitations on Distributions	36
ARTICLE 10.		ALLOCATIONS OF NET PROFITS AND NET LOSSES	36
10.1		General Allocation of Net Profits and Losses	36
10.2		Regulatory Allocations	37
10.3		Tax Allocations	39
10.4		Other Provisions	39
ARTICLE 11.		MISCELLANEOUS	41
11.1		Amendments	41

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11.2		No Waiver	41
11.3		Entire Agreement	41
11.4		Further Assurances	41
11.5		Notices	42
11.6		Tax Matters	42
11.7		Governing Law	43
11.8		Construction; Interpretation	43
11.9		Rights and Remedies Cumulative	44
11.10		No Assignment; Binding Effect	44
11.11		Severability	44
11.12		Counterparts	44
11.13		Dispute Resolution	45
11.14		Third-Party Beneficiaries	45
11.15		Specific Performance	45
11.16		Consequential Damages	45

EXHIBITS

Exhibit A		Members, Addresses, Initial Capital Contributions, and Percentage Interests
Exhibit B		Initial Micron Managers
Exhibit C		Initial Photronics Managers
Exhibit D		Insurance

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LIMITED LIABILITY COMPANY OPERATING AGREEMENT
OF
MP MASK TECHNOLOGY CENTER, LLC

          THIS LIMITED LIABILITY COMPANY OPERATING AGREEMENT (together with the Exhibits, this "Agreement") is made and entered into as of the 5th day of May, 2006 (the "Effective Date"), by and between Micron Technology, Inc., a Delaware corporation ("Micron"), and Photronics, Inc., a Connecticut corporation ("Photronics"), with respect to MP Mask Technology Center, LLC (the "Company"), a limited liability company organized under the Delaware Limited Liability Company Act, as amended from time to time (the "Act").

ARTICLE 1.
ORGANIZATIONAL MATTERS

               1.1 Continuation

          The Company was formed under the Act on April 10, 2006 by filing a Certificate of Formation of the Company (the "Certificate") in the Office of the Secretary of State of the State of Delaware as required by the Act. The Members hereby continue the Company under the Act for the purposes and upon the terms and conditions hereinafter set forth. Micron hereby continues as a Member of the Company, and Photronics is admitted to the Company as a Member upon its execution of this Agreement and receipt by Micron of $48 million of the Purchase Price (as defined in the Contribution and Purchase Agreement). The rights and liabilities of the Members shall be as provided in the Act, except as otherwise expressly provided herein. In the event of any inconsistency between any terms and conditions contained in this Agreement and any non-mandatory provisions of the Act, the terms and conditions contained in this Agreement shall govern. If any provision of this Agreement is prohibited or ineffective under the Act, this Agreement will be considered amended to the smallest degree possible in order to make such provision effective under the Act. Subject to the provisions hereof, the Board of Managers may execute and file, or cause the General Manager to file, any duly authorized amendments to the Certificate from time to time in a form prescribed by the Act. The Board of Managers shall also cause to be made, on behalf of the Company, such additional filings and recordings as the Board of Managers shall deem necessary or advisable.

               1.2 Name

          The name of the Company shall be MP Mask Technology Center, LLC. The Company may also conduct business at the same time under one or more fictitious names if the Board of Managers determines that such is in the best interests of the Company. The Board of Managers may change the name of the Company from time to time, in accordance with Applicable Law.

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               1.3 Principal Place of Business; Other Places of Business

          The principal place of business of the Company is located at 3851 East Columbia Road, Boise, Idaho or at such other place within or outside the State of Delaware as the Board of Managers may from time to time designate. The Company may maintain offices and places of business at such other place or places within or outside the State of Delaware as the Board of Managers deem advisable.

               1.4 Business Purpose

          The purpose of the Company shall be the (a) development, fabrication and sale of advanced photomasks; (b) entry into any other lawful business, purpose or activity in which a limited liability company may be engaged under Applicable Law (including, without limitation, the Act) as the Members may determine from time to time, subject to and in accordance with the terms of this Agreement; and (c) entry into any lawful transaction and engagement in any lawful activity in furtherance of the foregoing purposes and as may be necessary, incidental or convenient to carry out the business of the Company as contemplated by this Agreement.

               1.5 Designated Agent for Service of Process

          The Company shall continuously maintain a registered office and a designated and duly qualified agent for service of process on the Company in the State of Delaware. As of the date hereof, the name of the duly qualified agent for service of process is Corporation Service Company and the address of the registered office of the Company in the State of Delaware is c/o Corporation Service Company, 2711 Centerville Road, Suite 400, Wilmington, DE 19808. The registered office and the registered agent may be changed from time to time by the Board of Managers, by causing the prescribed form, accompanied by the requisite filing fee, to be filed with the Delaware Secretary of State in accordance with the Act.

               1.6 Term

          The Company shall continue until the Company is terminated, dissolved or liquidated in accordance with this Agreement and the Act. Notwithstanding the dissolution of the Company, the existence of the Company shall continue until termination pursuant to and as provided in Article 8 of this Agreement.

               1.7 Objectives; Approved Technology

          The primary objectives of the Company (the "Primary Objectives") are to: (i) develop and produce prototypes for industry-leading, advanced, next-generation, high-end photomasks in accordance with Micron's specifications; (ii) achieve sustainable, leading edge photomask production capabilities; (iii) manufacture production photomasks for, and approved by, Micron pursuant to Micron's specifications and in quantities required under the Transaction Documents. To the extent the Company has excess capacity and resources after completely fulfilling the Primary Objectives (inclusive of fulfillment of Company and Micron engineering needs appropriate to accomplish the foregoing, but recognizing that Photronics may also support Micron's production photomask needs through its other facilities as allowed pursuant to the Transaction Documents), the Company's secondary objective (the "Secondary Objective") is to support the development of leading edge logic applications and manufacture prototypes and, when approved by the Technology Steering Committee, production photomasks, for use by external Photronics customers; [****].

          [****].

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               1.8 Transaction Documents

          Contemporaneous with, or prior to, the execution of this Agreement, Photronics, Micron and/or the Company have entered into the agreements listed on Schedule B to the Contribution and Purchase Agreement (collectively, the "Transaction Documents").

ARTICLE 2.
DEFINITIONS

          Capitalized words and phrases used and not otherwise defined elsewhere in this Agreement shall have the following meanings:

          "Act" is defined in the preamble.

          "Adjusted Capital Account Deficit" means, with respect to any Member at any time, the deficit balance, if any, in such Member's Capital Account as of such time, after giving effect to the following adjustments:

          (1) Add to such Capital Account the amount that such Member is obligated to restore or is deemed to be obligated to restore pursuant to Regulations Section 1.704-1(b)(2)(ii)(c) or the penultimate sentence of each of Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5); and

          (2) Subtract from such Capital Account such Member's share of the items described in Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6).

The foregoing definition of Adjusted Capital Account Deficit is intended to comply with the provisions of Regulations Section 1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith.

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          "Affiliate" of a Person means any other Person which, directly or indirectly, controls, is controlled by, or is under common control with, such Person. The term "control" (including, with correlative meaning, the terms "controlled by" and "under common control with"), as used with respect to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities, by contract or otherwise. A Person shall be deemed an Affiliate of another Person only so long as such control relationship exists. The parties acknowledge and agree that neither Photronics nor Micron is presently controlled by any other Person. Notwithstanding the foregoing, a Company Entity shall not be deemed to be an Affiliate of either Photronics or Micron, except where expressly provided in this Agreement.

          "Agreement" shall mean this Limited Liability Company Operating Agreement, together with the Exhibits, as amended or otherwise modified from time to time, which shall constitute the limited liability company agreement of the Company within the meaning of the Act.

          "Annual Budget" is defined in Section 6.4.

          "Applicable Law" means, with respect to a Person, any domestic or foreign, national, federal, territorial, state or local constitution, statute, law (including principles of common law), treaty, ordinance, rule, administrative interpretation, regulation, order, writ, injunction, legally binding directive, judgment, decree or other requirement or restriction of any arbitrator or Governmental Authority applicable to such Person or its properties, assets, officers, directors, employees, consultants or agents (in connection with such officer's, director's, employee's, consultant's or agent's activities on behalf of such Person).

          "Assignment and Assumption Agreement" means the Assignment and Assumption Agreement dated as of the date hereof, by and between Micron and the Company.

          "Base Contributions" is defined in Section 4.1.2(a).

          "Board of Managers" means, at any time, the Board of Managers of the Company designated in accordance with Section 5.2.

          "Business" is defined in Section 5.7(g).

          "Business Day" means any day other than a day on which commercial banks in the United States are required or authorized to be closed.

          "Capital Account" means the Capital Account maintained for each Member on the Company's books and records in accordance with the following provisions:

          (1) To each Member's Capital Account there shall be added (a) such Member's Capital Contributions, (b) such Member's allocable share of Net Profits and any items in the nature of income or gain that are specially allocated to such Member pursuant to Article 10 hereof or other provisions of this Agreement and (c) the amount of any Company liabilities assumed by such Member or which are secured by any property owned by such Member.

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          (2) From each Member's Capital Account there shall be subtracted (a) the amount of (i) cash and (ii) the Gross Asset Value of any Company Assets (other than cash) distributed to such Member pursuant to any provision of this Agreement in its capacity as a Member (for the avoidance of doubt, any payment to a Member pursuant to any license, consulting, services, subcontracting, lease or other agreement between the Company and such Member or any Affiliates of such Member shall not be treated as a "distribution"), (b) such Member's allocable share of Net Losses and any other items in the nature of expenses or losses that are specially allocated to such Member pursuant to Article 10 or other provisions of this Agreement, and (c) liabilities of such Member assumed by the Company or which are secured by any property contributed by such Member.

          (3) In the event any Interest in the Company is Transferred in accordance with the terms of this Agreement, the transferee shall succeed to the Capital Account of the transferor to the extent it relates to the Transferred Interest.

          (4) In determining the amount of any liability for purposes of subsections (1) and (2) of this definition, there shall be taken into account Code Section 752(c) and any other applicable provisions of the Code and Regulations.

          (5) The foregoing provisions and the other provisions of this Agreement relating to the maintenance of Capital Accounts are intended to comply with Regulations Sections 1.704-1(b) and 1.704-2 and shall be interpreted and applied in a manner consistent with such Regulations. In the event that the Board of Managers shall determine that it is prudent to modify the manner in which the Capital Accounts, or any additions or subtractions thereto, are computed in order to comply with such Regulations, the Board of Managers may make such modification, provided that it is not likely to have a material effect on the amounts distributable to any Member pursuant to Article 8 hereof upon the dissolution of the Company. The Board of Managers shall also make (a) any adjustments that are necessary or appropriate, in the absence of guidance under applicable Regulations, to maintain equality between the Capital Accounts of the Members and the amount of Company capital reflected on the Company's balance sheet, as computed for book purposes, in accordance with Regulations Section 1.704-1(b)(2)(iv)(q), and (b) any appropriate modifications in the event that unanticipated events might otherwise cause this Agreement not to comply with Regulations Sections 1.704-1(b) and 1.704-2.

          "Capital Contributions" means, with respect to any Member, the total amount of cash and the initial Gross Asset Value of property (other than cash) contributed to the capital of the Company by such Member.

          "Cash" means cash and cash equivalents determined by the Board of Managers in good faith consistent with GAAP.

          "Certificate" is defined in Section 1.1.

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          "Chairman of the Board" is defined in Section 5.5.

          "Change in Control" shall be deemed to have occurred, with respect to Micron or Photronics, when:

          (1) Any "person" or "group" (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act) is or becomes the "beneficial owner" (as defined in Rules 13d-3 and 13d-5 under the Exchange Act) of shares representing more than fifty percent (50%) of the combined voting power of the then outstanding securities entitled to vote generally in elections of directors of Micron or Photronics, as the case may be (the "Voting Stock");

          (2) Micron or Photronics (A) consolidates with or merges into any other Person or any other Person merges into Micron or Photronics, and in the case of any such transaction, the outstanding common stock of Micron or Photronics, as the case may be, is changed or exchanged into other assets or securities as a result, unless the stockholders of Micron or Photronics, as the case may be, immediately before such transaction own, directly or indirectly immediately following such transaction, more than fifty percent (50%) of the combined voting power of the outstanding voting securities of the corporation resulting from such transaction in substantially the same proportion as their ownership of the Voting Stock immediately before such transaction, or (B) conveys, transfers or leases all or substantially all of its assets to any Person; or

          (3) Any time Continuing Directors do not constitute a majority of the Board of Directors of Micron or Photronics, as the case may be (or, if applicable, a successor Person to Micron or Photronics, as the case may be).

          "Change in Control Notice" is defined in Section 7.4.1.

          "Change in Control Closing" is defined in Section 7.4.2.

          "Change in Control Closing Price" is defined in Section 7.4.3.

          "Change in Control Option Price" is defined in Section 7.4.3.

          "Code" means the Internal Revenue Code of 1986, as amended from time to time (or any corresponding provisions of succeeding law).

          "Company" is defined in the preamble.

          "Company Accountant" shall mean initially PricewaterhouseCoopers LLP or such other independent accounting firm as appointed from time to time by the Board of Managers.

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          "Company Assets" means all direct and indirect rights and interests in real and personal property owned by the Company and its subsidiaries from time to time, and shall include both tangible and intangible property (including Cash).

          "Company Correlative Item" is defined in Section 10.4.4(b).

          "Company Entity" means the Company, or any of its directly or indirectly majority owned subsidiaries (whether organized as corporations, limited liability companies or other legal entities).

          "Company Minimum Gain" has the meaning set forth in Regulations Sections 1.704-2(b)(2) and 1.704-2(d)(1) for the phrase "partnership minimum gain."

          "Company Section 482 Allocation" is defined in Section 10.4.4(a).

          "Competing Products" [****].

          "Continuing Director" means, solely with respect to Micron or Photronics, at any date, a member of Micron's or Photronics' Board of Directors, as the case may be, (i) who was a member of such board as of the Effective Date or (ii) who was nominated or elected by at least a majority of the directors who were Continuing Directors at the time of such nomination or election or whose election to such board was recommended or endorsed by at least a majority of the directors who were Continuing Directors at the time of such nomination or election or such lesser number comprising a majority of a nominating committee comprised of independent directors if authority for such nominations or elections has been delegated to a nominating committee whose authority and composition have been approved by at least a majority of the directors who were Continuing Directors at the time such committee was formed.

          "Contribution and Purchase Agreement" means the Contribution and Units Purchase Agreement dated as of the date hereof by and between the Company, Micron and Photronics.

          "Depreciation" means, for each Fiscal Year of the Company or other period, an amount equal to the federal income tax depreciation, amortization or other cost recovery deduction allowable with respect to an asset for such year or other period, except that if the Gross Asset Value of an asset differs from its adjusted basis for federal income tax purposes at the beginning of such year or other period, Depreciation shall be an amount that bears the same ratio to such beginning Gross Asset Value as the federal income tax depreciation, amortization or other cost recovery deduction for such year or other period bears to such beginning adjusted tax basis; provided, however, that if the federal income tax depreciation, amortization or other cost recovery deduction for such year or other period is zero, Depreciation shall be determined with reference to such beginning Gross Asset Value using any reasonable method selected by the Board of Managers.

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**** Material omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Exchange Act of 1934. Material filed separately with the Securities and Exchange Commission.

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          "Economic Interest" means a Person's right to share in allocations of Net Profits, Net Losses and other items of income, gains, losses, deductions and credits hereunder and to receive distributions from the Company as set forth in this Agreement, but does not include any other rights of a Member including, without limitation, the right to vote or to participate in the management of the Company, or, except as specifically provided in this Agreement or required under the Act, any right to information concerning the business and affairs of the Company.

          "Effective Date" is defined in the preamble.

          "Excess Allocation" is defined in Section 9.1.2.

          "Exchange Act" means the Securities Exchange Act of 1934, as amended.

          "Fiscal Month" is defined in Section 5.10.1.

          "Fiscal Quarter" is defined in Section 5.10.1.

          "Fiscal Year" is defined in Section 5.10.1.

          "GAAP" means generally accepted accounting principles in the United States as in effect from time to time.

          "GAAS" means generally accepted auditing standards in the United States as in effect from time to time.

          "General Manager" is defined in Section 5.12.1.

          "Governmental Authority" means any foreign, domestic, national, federal, territorial, state or local governmental authority, quasi-governmental authority, instrumentality, court, government or self-regulatory organization, commission, tribunal or organization or any regulatory, administrative or other agency, or any political or other subdivision, department or branch of any of the foregoing.

          "Gross Asset Value" means, with respect to any asset, the asset's adjusted basis for federal income tax purposes, except as follows:

          (1) The initial Gross Asset Value of the Micron Contributed Assets shall be as set forth on Exhibit A. The initial Gross Asset Value of any other asset contributed by a Member shall be the fair value of such asset as determined by the Board of Managers and the contributing Member.

          (2) The Gross Asset Value of all Company Assets immediately prior to the occurrence of any event described in subsections (a) through (d) hereof shall be adjusted to equal their respective fair values, in accordance with the applicable valuation provisions of this Agreement, or if there are no such provisions, as determined by the Board of Managers using such reasonable method of valuation as the Board of Managers may adopt, upon the occurrence of the following events and in accordance with the applicable Regulations:

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               (a) the acquisition of an additional Interest in the Company (other than in connection with the execution of this Agreement) by a new or existing Member in exchange for more than a de minimis Capital Contribution, if the Board of Managers reasonably determines that such adjustment is necessary or appropriate to reflect the relative Economic Interests of the Members in the Company;

               (b) the distribution by the Company to a Member of more than a de minimis amount of Company Assets as consideration for an Economic Interest or Interest in the Company, if the Board of Managers reasonably determines that such adjustment is necessary or appropriate to reflect the relative Economic Interests of the Members in the Company;

               (c) the liquidation of the Company within the meaning of Regulations Section 1.704-1(b)(2)(ii)(g); and

               (d) at such other times as the Board of Managers shall reasonably determine necessary or advisable in order to comply with Regulations Sections 1.704-1(b) and 1.704-2.

          (3) The Gross Asset Value of any Company Asset distributed to a Member shall be the gross fair market value of such Company Asset on the date of distribution as determined by the Board of Managers.

          (4) The Gross Asset Values of Company Assets shall be increased (or decreased) to reflect any adjustments to the adjusted basis of such Company Assets pursuant to Code Section 734(b) or Code Section 743(b), but only to the extent that such adjustments are taken into account in determining Capital Accounts pursuant to Regulations Section 1.704-1(b)(2)(iv)(m); provided, however, that Gross Asset Values shall not be adjusted pursuant to this subsection (4) of this definition to the extent that the Board of Managers reasonably determines that an adjustment pursuant to subsection (2) of this definition above is necessary or appropriate in connection with a transaction that would otherwise result in an adjustment pursuant to this subsection (4) of this definition.

          (5) If the Gross Asset Value of a Company Asset has been determined or adjusted pursuant to subsections (1), (2) or (4) of this definition, such Gross Asset Value shall thereafter be adjusted by the Depreciation taken into account with respect to such Company Asset for purposes of computing Net Profits and Net Losses.

          "Increasing Member" is defined in Section 5.4.1

          "Indemnified Loss" is defined in Section 5.11.1.

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          "Indemnitee" is defined in Section 5.11.1.

          "Liquidators" is defined in Section 8.5.1.

          "Majority Member" is defined in Section 7.3.1.

          "Managers" means at any time the individuals designated in accordance with Section 5.2 to serve on the Board of Managers.

          "Maximum Base Contributions Amount" is defined in Section 4.1.2(a).

          "Maximum Excess Contributions Amount" is defined in Section 4.1.2(b).

          "Member" means a Person owning a Membership Interest.

          "Member Correlative Item" is defined in Section 10.4.4(a).

          "Member Minimum Gain" means "partner nonrecourse debt minimum gain" as defined in Regulations Section 1.704-2(i)(2).

          "Member Nonrecourse Debt" means "partner nonrecourse debt" as set forth in Regulations Section 1.704-2(b)(4).

          "Member Nonrecourse Deductions" means "partner nonrecourse deductions" as set forth in Regulations Section 1.704-2(i).

          "Member Section 482 Allocation" is defined in Section 10.4.4(b).

          "Membership Interest" or "Interest" means the entire ownership interest of a Member in the Company at any particular time, including without limitation, the Member's Economic Interest, any and all rights to vote and otherwise participate in the Company's affairs, and the rights to any and all benefits to which a Member may be entitled as provided in this Agreement, together with the obligations of such Member to comply with all of the terms and provisions of this Agreement. A Membership Interest may be expressed as a number of Units.

          "Micron" is defined in the preamble.

          "Micron Contributed Assets" mean the "Transferred Assets" (as defined in the Contribution and Purchase Agreement) contributed by Micron to the Company.

          "Micron Manager" means any of the Managers designated by Micron to serve on the Board of Managers in accordance with Section 5.2.

          "Minority Closing" is defined in Section 7.3.1.

          "Minority Closing Price" is defined in Section 7.3.2.

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          "Minority Member" is defined in Section 7.3.1.

          [****]

          "Net Profits" or "Net Losses" means, for each Fiscal Year or other period, an amount equal to the Company's taxable income or loss for such year or period determined in accordance with Code Section 703(a) (for this purpose, all items of income, gain, loss or deduction required to be stated separately pursuant to Code Section 703(a)(1) shall be included in taxable income or loss), with the following adjustments:

          (1) Any income of the Company that is exempt from federal income tax and not otherwise taken into account in computing Net Profits or Net Losses pursuant to this definition shall be added to such taxable income or loss;

          (2) Any expenditure of the Company described in Code Section 705(a)(2)(B) or treated as a Code Section 705(a)(2)(B) expenditure pursuant to Regulations Section 1.704-1(b)(2)(iv)(i), and not otherwise taken into account in computing Net Profits or Net Losses pursuant to this subsection (2) of this definition, shall be subtracted from such taxable income or loss;

          (3) Gain or loss resulting from any disposition of Company Assets where such gain or loss is recognized for federal income tax purposes shall be computed by reference to the Gross Asset Value of the Company Assets disposed of, notwithstanding that the adjusted tax basis of such Company Assets differs from its Gross Asset Value;

          (4) In lieu of the depreciation, amortization and other cost recovery deductions taken into account in computing such taxable income or loss, there shall be taken into account Depreciation for such Fiscal Year;

          (5) To the extent an adjustment to the adjusted tax basis of any asset included in Company Assets pursuant to Code Section 734(b) or Code Section 743(b) is required pursuant to Regulations Section 1.704-1(b)(2)(iv)(m)(4) to be taken into account in determining Capital Accounts as a result of a distribution other than in liquidation of a Member's Interest, the amount of such adjustment shall be treated as an item of gain (if the adjustment increases the basis of the asset) or loss (if the adjustment decreases the basis of the asset) from the disposition of the asset and shall be taken into account for the purposes of computing Net Profits and Net Losses;

          (6) If the Gross Asset Value of any Company Asset is adjusted in accordance with subsection (2) or subsection (3) of the definition of "Gross Asset Value," the amount of such adjustment shall be taken into account in the taxable year of such adjustment as gain or loss from the disposition of such asset for purposes of computing Net Profits or Net Losses; and

          (7) Notwithstanding any other provision of this definition, any items of income, gain, loss or deduction that are specially allocated pursuant to Sections 10.2 and 10.4.4 shall not be taken into account in computing Net Profits or Net Losses. The amount of items of income, gain, loss and deduction available to be specially allocated shall be determined using principles analogous to those set forth in this definition.

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          The Members acknowledge and agree that for financial accounting purposes the results of the Company's operations will be reported in accordance with GAAP.

          "Non-Disclosure Agreement" means the Non-Disclosure Agreement, dated as of the date hereof, by and among the Company, Micron and Photronics.

          "Nonrecourse Deductions" has the meaning set forth in Regulations Sections 1.704-2(b)(1) and 1.704-2(c).

          "Officer" is defined in Section 5.12.3.

          "Option Price" is defined in Section 7.3.2.

          "Percentage Interest" means, with respect to a Member holding one or more Units, its Interest in the Company as determined by dividing the number of Units owned by such Member by the total number of Units of the Company then outstanding as specified in Exhibit A attached hereto, as such exhibit may be modified or supplemented from time to time in accordance with the terms of this Agreement. A change in a Member's Capital Account shall not affect the Percentage Interests of the Members unless expressly provided in this Agreement.

          [****]

          "Person" means any person or entity, whether an individual, trustee, corporation, partnership, limited partnership, limited liability company, trust, unincorporated organization, business association, firm, joint venture, other legal entity or Governmental Authority.

          "Photronics" is defined in the preamble.

          "Photronics Manager" means any of the Managers designated by Photronics to serve on the Board of Managers in accordance with Section 5.2.

          "Primary Objectives" is defined in Section 1.7.

          "Proceeding" means any action, suit, hearing, arbitration, proceeding (public or private), investigation, examination, audit or claim brought by or against any Governmental Authority.

          "R&D" is defined in Section 3.6.

          "Reducing Member" is defined in Section 5.4.1.

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          "Regulations" means temporary and final Treasury Regulations promulgated under the Code, as such regulations may be amended from time to time (including corresponding provisions of succeeding Treasury Regulations).

          "Regulatory Allocations" is defined in Section 10.2.8.

          "Representative" is defined in Section 5.11.7(e).

          "Responsible Party" is defined in Section 5.11.6.

          "Secondary Objective" is defined in Section 1.7.

          "SG&A" is defined in Section 3.6.

          "Special Vote" means the affirmative vote or consent of each of Micron (provided that Micron shall be entitled to such vote or consent only so long as Micron's Percentage Interest is at least twenty-five percent (25%)) and Photronics (provided that Photronics shall be entitled to such vote or consent only so long as Photronics' Percentage Interest is at least twenty-five percent (25%)).

          "Tax" or "Taxes" means all taxes, levies, imposts and fees imposed by any Governmental Authority (domestic or foreign) of any nature including but not limited to federal, state, local or foreign net income tax, alternative or add-on minimum tax, profits or excess profits tax, franchise tax, gross income, adjusted gross income or gross receipts tax, employment related tax (including employee withholding or employer payroll tax, FICA or FUTA), real or personal property tax or ad valorem tax, sales or use tax, excise tax, stamp tax or duty, any withholding or back up withholding tax, value added tax, severance tax, prohibited transaction tax, premiums tax, occupation tax, together with any interest or any penalty, addition to tax or additional amount imposed by any Governmental Authority (domestic or foreign) responsible for the imposition of any such tax.

          "Tax Matters Partner" shall mean Micron.

          "Technology License Agreement" means the Technology License Agreement dated as of the date hereof by and among the Company, Micron and Photronics.

          "Technology Steering Committee" is defined in Section 5.13.

          "Transaction Documents" is defined in Section 1.8.

          "Transfer" (including, with correlative meaning, the term "Transferred") means, with respect to any Unit, Membership Interest or Economic Interest or portion thereof, a sale, conveyance, exchange, assignment, pledge, encumbrance, gift, bequest, hypothecation or other transfer or disposition by any other means, whether for value or no value and whether voluntary or involuntary (including, without limitation, by operation of law), or an agreement to do any of the foregoing.

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          "Unit" means, with respect to a Membership Interest, a fractional, undivided share of such Membership Interest issued pursuant to Article 3 of this Agreement. A Membership Interest may include a fractional Unit. As of the date hereof, the Units are held by the Members in accordance with Exhibit A, which Exhibit will be updated from time to time in accordance with the terms of this Agreement.

          "Voting Stock" is defined in the definition of "Change in Control."

ARTICLE 3.
CAPITAL; CAPITAL ACCOUNTS AND MEMBERS

               3.1 Initial Capital Contributions of Members

          3.1.1 Capital Contributions. The Members acknowledge and agree that as of the date hereof: (i) pursuant to the Contribution and Purchase Agreement Micron has contributed to the Company the Micron Contributed Assets; and (ii) pursuant to the Assignment and Assumption Agreement Micron has assigned to the Company certain contractual rights and other liabilities, and the Company has assumed certain liabilities of Micron in connection therewith. Upon Photronics purchase of 49,990 Units, from Micron pursuant to the Contribution and Purchase Agreement, Photronics' and Micron's Capital Account balances shall have a relative ratio equal to 49.99 divided by 50.01.

          3.1.2 Capital Account Balances. The names, addresses, initial Capital Account balances of each Member (after giving effect to the transactions described in Section 3.1.1 and the sale by Micron of an Interest in the Company to Photronics pursuant to the LLC Units Sale and Purchase Agreement), Percentage Interests of, and number of Units owned by, the Members are as set forth on Exhibit A, provided that the gross asset value and capital account balances on Exhibit A will not be finalized until the completion of the balance sheet referenced in Section 5.10.3(a).

               3.2 Additional Capital Contributions by Members

          Except as provided in Section 3.1 and Section 4.1.2, no Member shall be required to make any Capital Contributions to the Company.

               3.3 Capital Accounts

          A Capital Account shall be established and maintained by the Company for each Member in accordance with the terms of this Agreement.

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               3.4 Member Capital

          Except as otherwise provided in this Agreement or approved by a Special Vote: (a) no Member shall demand or be entitled to receive a return of or interest on any portion of its Capital Contributions or balance in its Capital Account; (b) no Member shall withdraw any portion of its Capital Contributions or receive any distributions from the Company as a return of capital on account of such Capital Contributions; and (c) the Company shall not redeem or repurchase the Membership Interest of any Member, provided that any such return, distribution or redemption that is permitted hereunder shall be pro rata based upon the Members' respective Percentage Interests.

               3.5 Liability of Members

          Except as otherwise required by any non-waivable provision of the Act or other Applicable Law and except as provided in this Agreement or other agreements between the Company and one or more Members or their Affiliates, no Member shall be liable in any manner whatsoever for any debt, liability or other obligation of the Company, whether such debt, liability or other obligation arises in contract, tort, or otherwise solely by reason of being a Member.

               3.6 Certain Expenses.

          [****]

ARTICLE 4.
FINANCING OF THE COMPANY

               4.1 Types of Financing

          4.1.1 General. The Board of Managers shall be responsible for determining the type of financing required to fund the operations of the Company, which may include Capital Contributions from Members or incurring debt from Members or from public, private or bank markets.

          4.1.2 Member Contributions.

               (a) If the Board of Managers determines that the Company requires additional funding by way of Capital Contributions, then the Members shall make additional Capital Contributions of up to [****]. Any such written notice shall include the amount of required Capital Contribution and the required funding date and shall be sent to the Members at least twenty (20) Business Days prior to the required funding date. Such required funding date shall correspond to the end of a Fiscal Month. Subject to the dollar limitation set forth in this Section 4.1.2(a), [****].

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               (b) If the Members (or one of the Members as allowed pursuant to Section 4.1.2(c)) have made all of the Base Contributions provided for by Section 4.1.2(a) during any year and the Board of Managers determines that additional funding is required and advisable, then the Company shall pursue its own additional needed financing. If, after using its reasonable efforts to obtain such financing, the Company cannot obtain such financing on terms that are acceptable to the Company, then the Company may request that the Members make additional Capital Contributions in excess of the Base Contributions of up to an additional aggregate amount equal to such amount as agreed between the Members or, absent any such agreement, [****] (the "Maximum Excess Contributions Amount") (each Member having the right to contribute its pro rata share, determined by multiplying such amount by such Member's Percentage Interest (the "Excess Contributions")) to the Company upon the written request of the Board of Managers. Any such written request shall include the amount of requested Capital Contribution and the required funding date and shall be sent to the Members at least twenty (20) Business Days prior to the required funding date. Such required funding date shall correspond to the end of a Fiscal Month. Subject to the dollar limitation set forth in this Section 4.1.2(b), there shall be no limit on the number of such requests for Excess Contributions that the Board of Managers may make in any year. Subject to Section 4.1.2(c), each Member shall have the right to make any Excess Contribution pro rata based on its Percentage Interest.

               (c) If a Member fails to make a required Base Contribution or a requested Excess Contribution by the required funding date set forth pursuant to Section 4.1.2(a) or (b) above, then the other Member may elect to fund its portion and all or part of the non-funding Member's portion of such Base Contribution or Excess Contribution; provided, however, that in no event may a Member make during any year aggregate Base Contributions, including those made for itself and for the non-funding Member, in excess of the Maximum Base Contributions Amount or aggregate Excess Contributions, including those made for itself and for the non-funding Member, in excess of the Maximum Excess Contributions Amount, without the prior written consent of the other Member.

               (d) Upon the payment by either or both Members of any required Base Contribution or requested Excess Contribution, the Company shall issue a number of additional Units (rounded down to the nearest whole Unit) to the funding Member(s) equal to the amount of the Base Contribution or Excess Contribution, as the case may be, funded by the funding Member(s) divided by a fraction, the numerator of which is the [****]of the Company's Assets, less the [****] of the Company's liabilities, as of the required funding date immediately prior to the funding of the Base Contributions or Excess Contributions, as the case may be, and the denominator of which is the number of Units outstanding immediately prior to the funding of the Base Contributions or Excess Contributions, as the case may be.

               (e) The provisions of Sections 4.1.2(a)-(d) (including any obligation to make any Base Contribution or Excess Contribution requested on or prior to [****]) shall not apply following [****]unless neither Member has provided notice pursuant to Section 8.2(f) prior to [****], in which case such provisions shall again be applicable following [****].

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ARTICLE 5.
MANAGEMENT

               5.1 Board of Managers

          5.1.1 Powers. Except as otherwise expressly provided in this Agreement, all management powers over the business, property and affairs of the Company are exclusively vested in a board of Managers (the "Board of Managers"), and no Member shall have any right to participate in or exercise control or management power over the business and affairs of the Company or otherwise to bind, act or purport to act on behalf of the Company in any manner. Subject to the limitations set forth in this Agreement, the Board of Managers shall have all the rights and powers that may be possessed by a manager under the Act, which shall include, without limitation, the power to incur indebtedness, the power to enter into agreements and commitments of all kinds, the power to manage, acquire and dispose of Company Assets, and all ancillary powers necessary or convenient to the foregoing. Unless authorized by a Special Vote, no individual Manager may, in his or her capacity as a Manager, act for the Board of Managers or have authority to bind the Company. The Board of Managers may also designate one or more persons to open bank accounts and conduct other banking business on behalf of the Company. The Managers shall devote such time to the business and affairs of the Company as is reasonably necessary for the performance of their duties, but shall not be required to devote full time to the performance of such duties.

          5.1.2 Evaluation of General Manager. The Board of Managers will be responsible for supervision and evaluation of the Company's General Manager on an ongoing basis, including at least an annual review of his or her performance to ensure he or she is acting in accordance with prudent business practices.

               5.2 Number of Managers; Appointment of Managers

          The Board of Managers shall initially consist of six (6) individuals (each such individual, a "Manager"). Subject to Sections 5.3 and 5.4 below, three (3) of the Managers shall be appointed by Micron and three (3) of the Managers shall be appointed by Photronics. Unless a Manager resigns (including by death or retirement) or is removed either by the Member who appointed such Manager or in accordance with Section 5.3 or 5.4, each Manager shall hold office until a successor shall have been duly appointed by the appointing Member. Each Member having the right to nominate a Manager or Managers pursuant to this Section 5.2 shall have the right, in its sole discretion, to remove such Manager or Managers at any time, by delivery of written notice to the other Member, the Company and the Manager(s) to be removed. In the case of a vacancy in the office of a Manager for any reason (including by reason of death, resignation, retirement, expiration of such Manager's term or removal pursuant to the preceding sentence), the vacancy shall be filled by the Member that nominated the Manager in question; provided, however, that in the case of a vacancy created due to a change in a Member's Percentage Interest as described in Section 5.3 or 5.4, such vacancy shall be filled in accordance with Section 5.3 or 5.4. Micron hereby selects the individuals specified on Exhibit B hereto to serve on the initial Board of Managers. Photronics hereby selects the individuals specified on Exhibit C hereto to serve on the initial Board of Managers.

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               5.3 Effect of Reduction in Photronics' Percentage Interest on Photronics Managers

          Subject to Section 5.4.1 below, the number of Managers that Photronics can appoint to or maintain on the Board of Managers shall depend on Photronics' Percentage Interest as follows:

Photronics' Percentage Interest		Number of Photronics Managers
[****]		3
[****]		1
[****]		0

               5.4 Effect of Reduction in Micron's Percentage Interest on Micron Managers

          Subject to Section 5.4.1 below, the number of Managers that Micron can appoint to or maintain on the Board of Managers shall depend on Micron's Percentage Interest as follows:

Micron's Percentage Interest		Number of Micron Managers
[****]		3
[****]		1
[****]		0

          5.4.1 Procedure. If either Member's Percentage Interest should be below any of the threshold levels set forth in Sections 5.3 or 5.4 above and if such Member (the "Reducing Member") then has more designees serving on the Board of Managers than the number to which it is entitled, such Reducing Member shall immediately identify by written notice to the other Member the designee or designees on the Board of Managers that will cease serving on the Board of Managers, and each such designee shall thereupon cease to be a Manager or member of the Board of Managers. If such Reducing Member fails to make such designation within five (5) Business Days after written demand by the other Member (the "Increasing Member"), the Increasing Member may designate by written notice to the Reducing Member one or more (as appropriate) of the Reducing Member's designees on the Board of Managers that will cease serving on the Board of Managers and each such designee shall thereupon cease to be a Manager or member of the Board of Managers. Upon the written notice described in either of the immediately preceding two sentences, the Increasing Member may immediately fill the vacancies created by such removals by written notice to the other Member designating its selected Manager(s). Similarly, if a Member whose Percentage Interest fell below any threshold level set forth in Section 5.3 or 5.4 subsequently increases its Percentage Interest above any such level, the process shall be reversed.

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               5.5 Chairman of the Board of Managers

          A Chairman of the Board of Managers (the "Chairman of the Board") shall preside at all meetings of the Board of Managers. The Chairman of the Board shall be selected from among the Managers appointed by Micron; provided, however, that if the Percentage Interest of Micron falls below [****], then the Chairman of the Board will be selected by Photronics if Photronics' Percentage Interest is above [****] or otherwise by the Board of Managers.

               5.6 Meetings of Members and of the Board of Managers; Quorum

          5.6.1 Member Meetings. At any time, and from time to time, the Board of Managers may, but shall not be required to, call meetings of the Members. Special meetings of the Members for any proper purpose or purposes may be called at any time by either Member. Written notice of any such meeting (which may be given via confirmed facsimile, confirmed e-mail or other manner provided for in Section 11.5) shall be given to all Members not less than five (5) Business Days nor more than thirty-five (35) Business Days prior to the date of such meeting. Each meeting of the Members shall be conducted by the Chairman of the Board of Managers or any designee thereof. Each Member may authorize any Person by written proxy to act for it or on its behalf on all matters in which the Member is entitled to participate. Each proxy must be signed by a duly authorized officer of the Member. All other provisions governing or otherwise relating to the holding of meetings of the Members shall from time to time be established in the sole discretion of the Board of Managers.

          5.6.2 Action by Member Consent. Any action which may be taken at any meeting of the Members may be taken without a meeting, without prior notice and without a vote if a consent in writing, setting forth the action so taken, is executed by all Members.

          5.6.3 Board Meetings. The Board of Managers shall hold meetings at least once every Fiscal Quarter. The presence of four (4) Managers (with at least fifty percent (50%) of the Managers present being Micron Managers), in each case, in person or by telephone conference or by other means of communication acceptable to the Board of Managers, shall be necessary and sufficient to constitute a quorum for the purpose of taking action by the Board of Managers at any meeting of the Board of Managers. Each Member may authorize any Person by written proxy to act for or on behalf of any Manager that such Member has the right to nominate on all matters in which such Manager is entitled to participate. Each proxy must be signed by a duly authorized officer of the Member. Each Member shall be responsible for the expenses of the Manager(s) appointed by such Member in connection with all meetings of the Board of Managers. Either Member may place items on the agenda for any meeting of the Board of Managers, and the Chairman of the Board of Managers will call for a vote on any matter at the reasonable request of any Member.

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          5.6.4 Notice; Waiver. The regular quarterly meetings of the Board of Managers described in Section 5.6.3 shall be held upon not less than five (5) Business Days written notice. Additional meetings of the Board of Managers may be held at the request of any Manager, upon not less than five (5) Business Days' written notice (which may be given via confirmed facsimile, confirmed e-mail or other manner provided for in Section 11.5) or telephonic notice to each Manager (which notice shall be provided to the other Managers by the requesting Manager). The presence of any Manager at a meeting (including by means of telephone conference or other means of communication acceptable to the Board of Managers) shall constitute a waiver of notice of the meeting with respect to such Manager. No action taken by the Managers at any meeting shall be valid unless the requisite quorum is present.

          5.6.5 Voting of Managers. Except as otherwise expressly provided in this Agreement, all actions, determinations or resolutions of the Board of Managers shall require the affirmative vote or consent of a majority of the Board of Managers present at any meeting at which a quorum is present; provided, however, that in the event of an evenly split vote, the Chairman of the Board will automatically receive an additional vote to break any such evenly split vote. Except as provided in the prior sentence, each Manager shall be entitled to one (1) vote, and Managers shall be entitled to cast their vote through proxies. The Board of Managers may act without a meeting if the action is consented to in advance or subsequently ratified, in each case in writing, by all of the Managers.

          5.6.6 Meetings by Telecommunications. Managers and their proxies shall have the right to participate in all meetings of the Board of Managers by means of a conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other at the same time and participation by such means shall constitute presence in person at a meeting. Members and their representatives and proxies shall have the right to participate in all meetings of the Members by means of a conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other at the same time and participation by such means shall constitute presence in person at a meeting.

          5.6.7 Reliance by Third Parties. Any Person dealing with the Company, the Micron Member, the Photronics Member, any Manager or any Officer may rely upon a certificate signed by any one Micron Manager and one Photronics Manager as to: (a) the identity of any Manager or Officer; (b) the existence or non-existence of any fact or facts which constitute a condition precedent to acts by the Managers or Officers or in any other manner germane to the affairs of the Company; (c) the Persons who are authorized to execute and deliver any instrument or document for or on behalf of the Company; or (d) any act or failure to act by the Company or as to any other matter whatsoever involving the Company, the Micron Member, the Photronics Member, any Manager or any Officer.

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               5.7 Actions Requiring a Special Vote

          Notwithstanding the provisions of Section 5.6.5 or any other provisions of this Agreement, the Company may not, and no Member or Manager may cause the Company to, take any of the following actions (or any other action specified in this Agreement as requiring a Special Vote) without a Special Vote:

               (a) effect a merger or consolidation (in a transaction or series of transactions) in which the Company is not the surviving entity or in which the Company is the surviving entity but in either case in which the Membership Interests or Units possessing more than fifty percent (50%) of the total combined Membership Interests or Units are transferred to a Person or Persons different than those who held such interests immediately prior to the merger or consolidation or the initial transaction culminating in such merger or consolidation;

               (b) sell or otherwise transfer all or substantially all of the assets of the Company to any other Person, including to another Company Entity;

               (c) settle any lawsuit, administrative proceeding, tax claim or other legal proceeding where any Company Entity pays the settlement of a dollar amount that is greater than [****] of the fair market value (subject to the last paragraph of this Section 5.7, as determined by the Board of Managers) of the assets of the Company Entities taken as a whole;

               (d) effect any investment in, or acquisition of, assets or equity interests (including by a merger, consolidation or otherwise) by a Company Entity or Company Entities that comprise greater than [****] of the fair market value of the assets of the Company Entities taken as a whole, as determined by the Board of Managers (other than in connection with the Company's routine cash management functions);

               (e) approve the fairness of pricing terms and the fairness of other terms having an economic impact of any contract, agreement, arrangement or understanding (or any series of related contracts, agreements, arrangements or understandings relating to the same or substantially similar subject matter) entered into after the date hereof between any Company Entity on the one hand, and either Member (or any of their respective Affiliates) on the other hand, that involves actual or potential payments to or from any Company Entity exceeding [****] in any Fiscal Year or [****] in the aggregate over the life of the contract, agreement, arrangement or understanding;

               (f) approve the fairness of pricing terms and the fairness of other terms having an economic impact of any amendment to any contract, agreement, arrangement or understanding (or any series of related contracts, agreements, arrangements or understandings relating to the same or substantially similar subject matter) between any Company Entity on the one hand, and either Member (or any of their respective Affiliates) on the other hand, which amendment involves (i) a change in actual or potential payments to or from any Company Entity exceeding [****] in any Fiscal Year or [****] in the aggregate over the life of the contract, agreement, arrangement or understanding or (ii) a material reduction in the services, rights or privileges received by any Company Entity under the contract, agreement, arrangement or understanding without proportionate reduction in fees, royalties or other payments to such Member (or its respective Affiliates, provided that no Company Entity shall be deemed a Member Affiliate for the purposes of this provision) thereunder;

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               (g) authorize any Company Entity to engage in or undertake any material activity that is materially unrelated to the Company's pursuit of the Business (for purposes of this subsection (g), "Business" shall mean all activities related to or reasonably required in connection with the design, development fabrication and sale of advanced photomasks);

               (h) effect any distribution from the Company to its Members other than in cash or any distribution in cash other than in accordance with Article 9 of this Agreement;

               (i) effect any resolution to wind-up the Company or any Company Entity (unless the relevant governing documents or this Agreement expressly provide for "automatic" dissolution upon the occurrence of specified events);

               (j) effect the filing of any application or petition for bankruptcy, reorganization or other similar proceedings under Applicable Law with respect to the Company or any Company Entity;

               (k) file any lawsuit by the Company or any Company Entity against any Person that is a customer of Photronics;

               (l) suspend the Company's operations for a period of greater than [****];

               (m) issue any additional Units or Membership Interests, or securities convertible into Units or Membership Interests, or admit any new Member other than pursuant to the terms of this Agreement;

               (n) change the Company's Fiscal Year; or

               (o) [****].

               5.8 Compensation of Managers

          The Managers shall not be entitled to any compensation in their capacities as Managers unless otherwise agreed upon in writing by all of the Members.

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               5.9 Other Activities

          Subject to Applicable Law and the provisions of the Transaction Documents, the Members, their respective Affiliates and the Managers may engage or invest in, and devote their time to, any other business venture or activity of any nature and description (independently or with others), whether or not such other activity may be deemed or construed to be in competition with the Company. Neither the Company nor any Member, Affiliate of a Member, or Manager shall have any right by virtue of this Agreement or the relationship created hereby in or to such other venture or activity of any Member or its Affiliates (or to the income or proceeds derived therefrom), and the pursuit thereof, even if competitive with the business of the Company, shall not be deemed wrongful or improper.

               5.10 Accounting; Records and Reports

          5.10.1 Accounting and Fiscal Year. The books, records and accounts of the Company, including for all applicable tax purposes, will be maintained in accordance with such methods of accounting as shall be determined by the Board of Managers. The fiscal year of the Company ("Fiscal Year"), including each of the fiscal quarters (the "Fiscal Quarters") and each of the fiscal months ("Fiscal Months") thereof, shall correspond to that of Micron for as long as Micron and/or an Affiliate of Micron holds a fifty percent (50%) or greater Percentage Interest in the Company in the aggregate. The Company shall have a taxable year which complies with Section 706(b) of the Code.

          5.10.2 Books and Records. The Board of Managers shall cause to be kept, at such location as the Board of Managers shall reasonably deem appropriate, full and proper ledgers, other books of account, and records of all receipts and disbursements and other financial activities of the Company in accordance with Micron's record retention policies. The Board of Managers shall also cause to be kept at such location copies of each of the following:

               (a) a current list of the full name and last known address of each Member, and the capital account, number of Units and Percentage Interest held by each Member;

               (b) a current list of the full name and last known address of each Manager;

               (c) the Certificate of the Company, any amendments to the Certificate, and executed copies of any powers of attorney granted for the purpose of executing the Certificate;

               (d) the Company's federal, state and local income tax returns and reports, if any, for the seven (7) most recent Fiscal Years;

               (e) this Agreement and any amendments to this Agreement;

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               (f) financial statements of the Company for the five (5) most recent Fiscal Years; and

               (g) minutes of all meetings of the Board of Managers and the Members and any written consents of the Board of Managers or the Members for actions taken without a meeting.

          5.10.3 Reports. The Board of Managers shall also cause to be sent to each Member of the Company, the following:

               (a) within forty-five (45) days after the Effective Date, the Company shall provide each Member with an unaudited balance sheet of the Company as of the Effective Date;

               (b) within 180 days following the end of each Fiscal Year, Schedule K-1 to IRS Form 1065 and such other information as may be reasonably required by the Members for preparation of their respective federal, state and local income or franchise tax returns;

               (c) a copy of the Company's federal, state and local income tax or information returns for each Fiscal Year, concurrent with the filing of such returns;

               (d) within seventy-five (75) days after the end of each Fiscal Year or as soon thereafter as reasonably practicable, the Company shall provide each Member with an audited balance sheet, income statement and statement of cash flows for and as of the last day of the Fiscal Year then ended, audited in accordance with GAAS by an auditor agreed to by Micron; provided, that Photronics shall reimburse the Company for the cost of such audit;

               (e) within forty-five (45) days after the end of each Fiscal Quarter or as soon thereafter as reasonably practicable, the Company shall provide each Member with an unaudited balance sheet, income statement and statement of cash flows for and as of the last day of the year or quarter (as appropriate) then ended, prepared in accordance with GAAP, as well as such other financial information as any Member may reasonably request to enable such Member and its Affiliates to prepare their consolidated quarterly and annual financial statements; and

               (f) within a reasonable period of time, notice of any material litigation filed against the Company or any written claim by a Governmental Authority of any material violation of any state, federal or foreign law, statute, rule or regulation.

          5.10.4 Access to Company Books and Records.

               (a) To the extent not in violation of Applicable Law, Members (personally or through an authorized representative) may, for purposes reasonably related to their interests in the Company, during reasonable business hours (i) examine and copy (at their own cost and expense) the books and records of the Company, including the records listed in Section 5.10.2, and (ii) have access to the Company's management, internal and external accountants and attorneys, plans, properties and other assets to conduct due diligence and other investigations regarding the Business and assets of the Company at such Member's sole expense, and the Company shall reasonably cooperate with such Member in such due diligence and investigations. Upon reasonable notice, Photronics may also request reasonable short-term and temporary access to the properties of the Company by Photronics customers for technology review and validation. Any information obtained as a result of this Section 5.10.4 shall be used by a Member solely for purposes reasonably related to such Member's participation in the Company and shall be subject to the Non-Disclosure Agreement.

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               (b) Any Member's request for documents or request to inspect or copy documents or have access to the Company's management, plans, properties and other assets under this Section 5.10.4 (i) may be made by that Member or that Member's authorized representative and (ii) shall be made in writing to the General Manager and shall state the purpose of such demand. If a Member is not satisfied with the response of the General Manager, the Member may make such request of the Technology Steering Committee and/or the Board of Managers.

               5.11 Indemnification and Liability of the Managers

          5.11.1 Indemnification. The Company shall indemnify and hold harmless each Manager, the General Manager and all other Officers (individually, an "Indemnitee") to the fullest extent permitted by Applicable Law from and against any and all losses, claims, demands, costs, damages, liabilities, whether joint or several, expenses of any nature (including reasonable attorneys' fees and disbursements), judgments, fines, settlements and other amounts (each an "Indemnified Loss") arising from any and all claims, demands, actions, suits or proceedings, civil, criminal, administrative or investigative, in which the Indemnitee may be involved as a defendant, or threatened to be involved as a defendant (other than all claims, demands, actions, suits or proceedings brought by the Member who nominated such Manager, if applicable), relating to the performance or nonperformance of any act concerning the activities of the Company or by reason of the Indemnitee's status as a Manager, General Manager or Officer, as applicable, regardless of whether the Indemnitee retains such status at the time any such Indemnified Loss is paid or incurred, if (a) the Indemnitee acted in good faith and in a manner he or she reasonably believed to be in, or not opposed to, the best interests of the Company and, in the case of a criminal proceeding, had no reasonable cause to believe that his or her conduct was unlawful, and (b) the Indemnitee's conduct did not constitute an act or omission which involved intentional misconduct or a knowing violation of the law. The termination of an action, suit or proceeding by judgment, order, settlement, or upon a plea of nolo contendere or its equivalent, shall not, in and of itself, create a presumption or otherwise constitute evidence that the Indemnitee acted in a manner contrary to that specified in clauses (a) or (b) above.

          5.11.2 Expenses. Expenses incurred by an Indemnitee in defending any claim, demand, action, suit or proceeding subject to this Section 5.11 shall be advanced by the Company prior to the final disposition of such claim, demand, action, suit, or proceeding.

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          5.11.3 Company Expenses. Any indemnification provided hereunder shall be satisfied solely out of the Company Assets, as an expense of the Company. No Member shall be subject to liability by reason of these indemnification provisions.

          5.11.4 No Other Rights. The provisions of this Section 5.11 are for the benefit of the Indemnitees and shall not be deemed to create any rights for the benefit of any other Person; provided, however, that the indemnification rights provided in this Section 5.11 will inure to the benefit of the heirs, legal representatives, successors, assigns and administrators of the Indemnitee.

          5.11.5 No Liability. No Indemnitee shall be liable to the Company or to any Member for any losses sustained or liabilities incurred as a result of any act or omission of any Indemnitee if (a) the Indemnitee acted in good faith and in a manner he or she reasonably believed to be in, or not opposed to, the best interests of the Company and, in the case of a criminal proceeding, had no reasonable cause to believe that his or her conduct was unlawful, and (b) the Indemnitee's conduct did not constitute an act or omission which involved intentional misconduct or a knowing violation of the law.

          5.11.6 Reliance Upon Agreement. To the extent that any Manager, General Manager or Officer (each, a "Responsible Party") has, under Applicable Law or in equity, duties (including, without limitation, fiduciary duties) to the Company, any Member or other Person bound by the terms of this Agreement, such Responsible Parties acting in accordance with this Agreement shall not be liable to the Company, any Member, or any such other Person for its good faith reliance on the provisions of this Agreement.

          5.11.7 No Fiduciary Duties.

               (a) In connection with the determination of any and all matters presented for action to the Members, the Board of Managers or the Technology Steering Committee, as applicable, the Members acknowledge and agree that each Member will be acting on its own behalf and each Representative serving on the Board of Managers or the Technology Steering Committee will be acting on behalf of the Member that appointed such Representative.

               (b) Each Member may act, and, to the fullest extent permitted by Applicable Law, will be protected for acting, in its own interest (subject to the express terms of any contract entered into by such Member) without regard to the interest of the other Member or the Company or any of its subsidiaries, and, subject to Section 5.11.7(E), each Representative may act, and, to the fullest extent permitted by Applicable Law, will be protected for acting, at the direction or control of, or in a manner that such Representative believes is in the best interest of, the Member that appointed the Representative without regard to the interest of the other Member or the Company or any of its subsidiaries. Further, each Member may, to the fullest extent permitted by Applicable Law (subject to the express terms of any contract entered into by such Member), make decisions and exercise direction and control over the decisions of the Representatives appointed by such Member without duty to or regard for the interests of the other Member or the Company or any of its subsidiaries.

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               (c) The Company, on its own behalf and on behalf of each of its subsidiaries, and each Member waive, to the fullest extent permitted by Applicable Law, (1) any claim or cause of action against any Member or Manager or member of the Technology Steering Committee appointed by a Member based on the determination of any and all matters presented for action to the Members, the Board of Managers or the Technology Steering Committee, as applicable, (2) breach of fiduciary duty, duty of care, duty of loyalty or any other duty or (3) breach of the Act; provided, however, the foregoing will not limit any Member's obligation under or liability for breach of the express terms of this Agreement or any other agreement that they have entered into with the Company or any of its subsidiaries or the other Member.

               (d) The Company and each Member, by entering into this Agreement, expressly acknowledge that neither Member nor any of its designated Managers shall owe any fiduciary duties to the Company or to the other Member by virtue of such Member's ownership of a majority of the Units of the Company or such Member's Managers' positions on, and majority control of, the Board of Managers or the Technology Steering Committee.

               (e) The term "Representative" shall mean, with respect to a Member, the Managers and members of the Technology Steering Committee appointed by such Member, but not including, only for purposes of Section 5.11.7(c)(2), the General Manager or any other officer of the Company (and each such officer shall be bound by such fiduciary and other duties (including the duty of care and the duty of loyalty) as would apply to an officer having comparable authority and duties under the DGCL).

               5.12 General Manager

          5.12.1 General Manager. The Company will have a General Manager (the "General Manager") to be selected by Micron with input from the Board of Managers and Photronics; provided, however, that if the Percentage Interest of Micron falls below [****]then the General Manager will (after input from the Board of Managers and Micron) be selected by Photronics if Photronics' Percentage Interest is above [****] or otherwise by the Board of Managers.

          5.12.2 Duties and Powers of the General Manager. The General Manager shall, subject to the control of the Board of Managers, have general supervision, direction and control of the day-to-day affairs of the Company and shall report directly to the Board of Managers. Unless limited by the Board of Managers or this Agreement, he or she shall have the general powers and duties of management usually vested in the office of chief executive officer of corporations and shall have such other powers and duties as may be prescribed by the Board of Managers. Only the General Manager, the Board of Managers or individuals authorized by the General Manager or the Board of Managers shall have the ability to enter into binding agreements or approve payments on behalf of the Company.

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          5.12.3 Other Officers; Employment; Removal. The Company may also have a chief financial officer, a secretary and such other officers as determined by the Board of Managers, each of whom will be accountable to the General Manager (the General Manager and any other officers elected in accordance with this Section 5.12.3, each, an "Officer" and collectively, the "Officers"). The General Manager and any other Officer may be removed at any time upon an affirmative vote of the majority of the Board of Managers.

          5.12.4 Duties and Powers of Chief Financial Officer. Any chief financial officer of the Company shall keep and maintain, or cause to be kept and maintained, books and records of accounts of the properties and business transactions of the Company, including accounts of its assets, liabilities, receipts, disbursements, gains, losses and capital. He or she shall disburse the funds of the Company as may be ordered by the Board of Managers and shall render to the Board of Managers at their request an account of all his or her transactions as chief financial officer and of the financial condition of the Company. Authorizations with respect to the Company's depositories, disbursement of funds and related banking matters shall be as set forth in resolutions of the Board of Managers.

          5.12.5 Duties and Powers of Secretary.

               (a) Any secretary of the Company shall attend (in person or by telephone conference) all meetings of the Board of Managers and all meetings of the Members (whether any of such meetings are in person, by telephone conference or both) and record all votes and the minutes of all proceedings in a book to be kept for that purpose, and shall perform like duties for any standing committees when requested by such committee.

               (b) Any secretary of the Company shall keep, or cause to be kept, at the principal executive office or at the office of the Company's transfer agent or registrar, as determined by resolution of the Board of Managers, a register, or a duplicate register, showing the names of all Members and their addresses, Economic Interests and Percentage Interests, the number and date of certificates issued for the same (if any), and the number and date of cancellation of every certificate surrendered for cancellation (if any).

          5.12.6 General Provisions Regarding Officers.

               (a) The Board of Managers may, from time to time, designate Officers of the Company and delegate to such Officers such authority and duties as the Board of Managers may deem advisable and may assign titles (including, without limitation, president, vice-president and/or treasurer) to any such Officer. Unless the Board of Managers otherwise determines, if the title assigned to an Officer of the Company is one commonly used for Officers of a business corporation, then, subject to the terms of this Agreement, the assignment of such title shall constitute the delegation to such Officer of the authority and duties that are customarily associated with such office. Any number of titles may be held by the same Officer.

               (b) Any Officer to whom a delegation is made pursuant to the foregoing shall serve in the capacity delegated unless and until such delegation is revoked by the Board of Managers for any reason or no reason whatsoever, with or without cause, or such Officer resigns.

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               5.13 Technology Steering Committee

          The Company will establish a Technology Steering Committee (the "Technology Steering Committee") in accordance with the provisions of the Technology License Agreement.

               5.14 Non-Disclosure Agreement

          The parties acknowledge and agree that the contents and terms and conditions of all of the Transaction Documents and all proprietary or nonpublic information disclosed by one party to another party in connection with the Transaction Documents is subject to the Non-Disclosure Agreement.

               5.15 Maintenance of Insurance

          The Company shall at all times be covered by insurance of the types and in the amounts set forth on Exhibit D. Such insurance coverage may be provided through the coverage under one or more insurance policies maintained by the Company or by either Member. A certificate of insurance will be provided to the Members annually evidencing coverage.

               5.16 Related Party Agreements

          Micron, Photronics and the Company agree that any contract, agreement, amendment, arrangement or understanding entered into after the date hereof between any Company Entity on the one hand, and either Member (or any of their respective Affiliates) on the other hand, shall be on an arms-length basis.

ARTICLE 6.
OPERATIONS

               6.1 Headquarters

          The Company's world headquarters shall be in Boise, Idaho.

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               6.2 Surplus Equipment

               [****]

               6.3 Printability Studies

               [****]

               6.4 Operations Plan; Annual Budget

          The Company will operate in accordance with an operations plan, which plan shall be initially developed and agreed upon by Micron and Photronics, and amended from time to time by the Board of Managers and in no event less than annually. The Board of Managers will also be responsible for approving an annual budget (the "Annual Budget") on at least an annual basis.

ARTICLE 7.
DISPOSITION AND TRANSFERS OF INTERESTS

               7.1 Holding of Membership Interest

          For so long as Micron or Photronics, directly or indirectly, maintains a Membership Interest in the Company, Micron or Photronics, as applicable, must own and hold such Membership Interest either (a) itself or (b) through one or more wholly owned (including indirect wholly owned) subsidiaries.

               7.2 Transfer Moratorium

          No Member may Transfer all or any portion of its Membership Interest to any other Person without the prior written consent of the other Member and any such attempted Transfer shall be deemed void and of no force or effect, nor shall Micron or Photronics without the prior written consent of the other sell or transfer, or allow to be sold or transferred, or in any way dispose of, its ownership interest, either direct or indirect, in any wholly owned subsidiary (including any indirect wholly owned subsidiary) that owns, directly or indirectly, the Membership Interest held by Micron or Photronics, respectively, in each case other than [****].

               7.3 Purchase of Remaining Interest

          7.3.1 If the Percentage Interest of a Member (the "Minority Member") drops to [****] or less and remains at or below [****] for more than six (6) consecutive months, the other Member or a wholly owned subsidiary thereof (such other Member or Affiliate thereof, the "Majority Member") shall have the option to purchase all of the remaining Interest of the Minority Member at a cash purchase price equal to the Option Price, subject to the terms and conditions set forth below. The Majority Member may exercise this purchase option by delivering a written notice of its intent to exercise to the Minority Member. The closing of the purchase and sale of the Minority Member's remaining Interest (the "Minority Closing") shall take place as of the last day of the Fiscal Month in which the notice is delivered (unless such notice is delivered within the last ten (10) days of the end of a Fiscal Month, in which case the Minority Closing shall take place on the last day of the first full Fiscal Month thereafter). Such Minority Closing shall take place at the principal office of the Company or at such other location as the Majority Member and the Minority Member may mutually determine. At the Minority Closing, (i) the Minority Member shall transfer its remaining Interest in the Company to the Majority Member, free and clear of any liens or encumbrances, (ii) the Majority Member shall pay the Minority Member the Minority Closing Price by wire transfer of immediately available funds and (iii) the Minority Member shall deliver to the Majority Member such instrument or instruments of conveyance as the Majority Member reasonably requests.

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          7.3.2 Upon the Minority Closing, the Majority Member shall pay to the Minority Member a sum (the "Minority Closing Price") equal to the product of (i) the difference of [****]. Within five (5) Business Days after the month-end balance sheet becomes available (prepared in accordance with GAAP consistently applied and as of the last day of the Fiscal Month in which the Minority Closing occurred), [****]. If the Option Price is greater than the Minority Closing Price, the Majority Member shall deliver the difference to the Minority Member by wire transfer of immediately available funds within three (3) Business Days of such recalculation. If the Option Price is less than the Minority Closing Price, the Minority Member shall refund the difference to the Majority Member by wire transfer of immediately available funds within three (3) Business Days of such recalculation.

               7.4 Change in Control of Photronics

          7.4.1 [****].

          7.4.2 [****].

          7.4.3 [****].

          7.4.4 [****].

               7.5 Purchase and Sale Agreement

          In the event of any purchase and sale of Membership Interests under Section 7.3, 7.4 or 8.5.3, the parties thereto shall enter into a commercially reasonable agreement to implement such purchase and sale. Such agreement will include that (a) the selling Member is released from any obligation to make future capital contributions to the Company and (b) income and loss for the year in which such closing occurs will be allocated to the selling Member on a basis that reflects the actual operations of the Company's business for the period prior to the Closing and will not be allocated based on the product of the Company's income and loss for the entire year times that percentage of the year in which the selling Member held a Membership Interest.

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ARTICLE 8.
DISSOLUTION, LIQUIDATION, AND TERMINATION OF THE COMPANY

               8.1 Limitations

          The Company may be dissolved, liquidated, and terminated only pursuant to the provisions of this Article 8, and the parties hereto do hereby irrevocably waive, to the extent permitted by Applicable Law, any and all other rights they may have to cause a dissolution, liquidation or termination of the Company or a sale or partition of any or all of the Company Assets in connection with such dissolution or liquidation.

               8.2 Exclusive Causes

          Notwithstanding the Act, the following and only the following events shall cause the Company to be dissolved, liquidated, and terminated:

               (a) the election of all of the Members;

               (b) the entry of a decree of judicial dissolution pursuant to Section 18-802 of the Act;

               (c) any Member's election, if the Company ceases operation for more than six (6) months unless due to Force Majeure (as defined in the Supply Agreement dated as of the date hereof between Photronics and Micron);

               (d) Photronics' election following a material breach of this Agreement or any other material provision of any of the Transaction Documents by Micron and, if the material breach is capable of cure, such material breach continues uncured for a period (i) specified in such Transaction Document or (ii) of ninety (90) days of a written notice from Micron to Photronics of such material breach if no cure period is specified in such Transaction Document; provided that if the breach in the case of (ii) is capable of being cured and the breaching party has worked diligently and in good faith since the receipt of the notice to cure such breach, but has not cured the breach during the allotted time, the cure period will be extended for an additional thirty (30) days;

               (e) Micron's election following a material breach of this Agreement or any other material provision of any of the Transaction Documents by Photronics; and, if the material breach is capable of cure, such material breach continues uncured for a period (i) specified in such Transaction Document or (ii) of ninety (90) days of a written notice from Micron to Photronics of such material breach if no cure period is specified in such Transaction Document; provided that if the breach in the case of (ii) is capable of being cured and the breaching party has worked diligently and in good faith since the receipt of the notice to cure such breach, but has not cured the breach during the allotted time, the cure period will be extended for an additional thirty (30) days;

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               (f) either Member's election upon at least [****] notice prior to (i) the ten-year anniversary of this Agreement or (ii) the last date of each successive five-year period following the ten-year anniversary of this Agreement, such termination to be effective upon such ten-year anniversary or the last date of such five-year period, as applicable;

               (g) the election by a Member with a Percentage Interest of at least 90% to dissolve and wind up the affairs of the Company (which election shall not require the consent of the other Member), upon delivery of written notice of such election to the Company and the other Member;

               (h) the occurrence of any other event that, under the Act, makes it unlawful, impossible or impractical to carry on the business of the Company;

               (i) the election by either Member to dissolve and wind up the affairs of the Company upon (a) the occurrence of a bankruptcy of the Company, provided that the Member making such election is not in default of any payment obligation to the Joint Venture Company or (b) the bankruptcy, dissolution or liquidation of a Member, and further provided that, in either event, such election shall be made only after entry by the court presiding over the bankruptcy of an order granting relief from the automatic stay to make such election to the Member making such election; or

               (j) [****].

To the fullest extent permitted by law, any dissolution of the Company other than as provided in this Section 8.2 shall be a dissolution in contravention of this Agreement. The parties agree that the failure of a Member to make Base Contributions (but not the failure of a Member to make Excess Contributions) or the Transfer of Membership Interests by a Member in contravention of this Agreement shall, among other matters, constitute a material breach of this Agreement.

               8.3 Effect of Dissolution

          The dissolution of the Company shall be effective on the day on which the event occurs giving rise to the dissolution, but the Company shall not terminate until it has been wound up and its assets have been distributed as provided in Section 8.5.1 or 8.5.3 of this Agreement. Notwithstanding the dissolution of the Company, prior to the termination of the Company, the business of the Company and the affairs of the Members, as such, shall continue to be governed by this Agreement.

               8.4 No Capital Contribution Upon Dissolution

          Each Member shall look solely to the Company Assets for all distributions with respect to the Company, its Capital Contribution thereto, its Capital Account and its share of Net Profits or Net Losses, and shall have no recourse therefor (upon dissolution or otherwise) against any other Member. Accordingly, if any Member has a deficit Capital Account balance (after giving effect to all contributions, distributions and allocations for all taxable years, including the year during which the liquidation occurs), then such Member shall have no obligation to make any Capital Contribution with respect to such deficit, and such deficit shall not be considered a debt owed to the Company or to any other Person for any purpose whatsoever.

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               8.5 Liquidation

          8.5.1 Upon dissolution of the Company, the Board of Managers (or other Person(s) designated by a decree of court) shall act as the "Liquidators" of the Company. The Liquidators shall liquidate the Company Assets, and after allocating (pursuant to Article 10 of this Agreement) all income, gain, loss and deductions resulting therefrom, shall apply and distribute the proceeds thereof as follows:

               (a) first, to (i) the payment of the obligations of the Company to third parties, including, but not limited to and on a pari passu basis, taxes, debts, lease and other payments to Persons other than Members or their Affiliates; (ii) the expenses of liquidation; and (iii) the setting up of any reserves for contingencies, debts or liabilities to Persons other than the Members or their Affiliates, whether the whereabouts of the creditor is known or unknown, which the Board of Managers may consider necessary;

               (b) thereafter, amounts due to either Member or their respective Affiliates (other than a Company Entity) pursuant to intellectual property license agreements, consulting agreements, services agreements, subcontracting agreements, lease agreements and other similar agreements; and

               (c) thereafter, to the Members in proportion to the positive balances in the Members' respective Capital Accounts, determined after taking into account all Capital Account adjustments for the Company's taxable year during which such liquidation occurs, by the end of the taxable year in which such liquidation occurs or, if later, within ninety (90) days after the date of the liquidation.

          8.5.2 Notwithstanding Section 8.5.1 of this Agreement, in the event that the Board of Managers determines that an immediate sale of all or any portion of the Company Assets would cause undue loss to the Members, the Board of Managers, in order to avoid such loss to the extent not then prohibited by the Act, may either defer liquidation of and withhold from distribution for a reasonable time any Company Assets except those necessary to satisfy the Company's debts and obligations, or, subject to Section 9.4, distribute the Company Assets to the Members in kind (in accordance with the second sentence of Section 8.5.1).

          8.5.3 Notwithstanding Section 8.5.1 or 8.5.2 of this Agreement, in the event of termination pursuant to Section 8.2 (other than pursuant to Section 8.2(d)) Micron shall have the right, exercisable within thirty (30) days of such termination, to acquire, free and clear of all liens and other encumbrances (i) from Photronics, Photronics' Membership Interest at a purchase price equal [****]. The foregoing purchase price shall be determined (and adjusted as necessary) in the manner provided in Section 7.4.3.

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ARTICLE 9.
DISTRIBUTIONS

               9.1 Distributions of Cash Available for Distribution

          9.1.1 Use of Cash. Subject to applicable legal and contractual restrictions and to Section 9.2 and Article 8, Company cash will be treated as follows (in the following order of priority):

               (a) First, cash will be retained in the Company in an amount sufficient to fund the Company's operations. Such amount will take into consideration scheduled debt service, lease and other payments to third parties and payments of amounts due to either Member or their respective Affiliates pursuant to intellectual property license agreements, consulting agreements, services agreements, subcontracting agreements, lease agreements and other similar agreements; and

               (b) Second, subject to Section 9.1.2, any excess cash remaining will be distributed at the discretion of the Board of Managers to Micron and Photronics pro rata based on their Percentage Interests at the time of such distribution.

          9.1.2 Excess Allocations. Subject to Section 9.2 and Article 8, to the extent a Member's Percentage Interest is adjusted for any reason as provided in this Agreement and the aggregate allocations of Net Profit (and similar items) net of any allocations of Net Losses (and similar items) made to such Member pursuant to Article 10 on a cumulative basis through the effective time of such adjustment exceeded: (a) the aggregate distributions made to such Member pursuant to Sections 9.1.1(b) and 9.4 plus (b) all amounts previously distributed to such Member pursuant to this Section 9.1.2 through such effective time (collectively, an "Excess Allocation"), then prior to the making of any further distributions pursuant to Section 9.1.1(b), distributions shall first be made pro rata among the Members according to their respective Excess Allocation amounts existing at such time, to the extent thereof.

               9.2 Distributions Upon Liquidation

          Distributions made in conjunction with the final liquidation of the Company shall be applied or distributed as provided in Article 8 hereof.

               9.3 Withholding

          The Company may withhold amounts in respect of allocations or distributions if it is required to do so by any Applicable Law, and each Member hereby authorizes the Company to withhold from or pay on behalf of or with respect to such Member such amount of federal, state, local or foreign taxes that the Tax Matters Partner determines the Company is required to withhold or pay with respect to any amount distributable or allocable to such Member pursuant to this Agreement, provided that the Tax Matters Partner shall provide Photronics with twenty (20) Business Days advance written notice of the amount of any withholding to be made in respect of allocations or distributions to Photronics (or any Affiliate of Photronics) which notice shall demonstrate the calculation thereof. Any amount paid on behalf of or with respect to a Member pursuant to this Section 9.3 shall constitute a loan by the Company to such Member, which loan shall be repaid by such Member within twenty (20) Business Days after notice from the Company that such payment must be made unless: (i) the Company withholds such payment from a distribution that would otherwise be made to the Company or (ii) the Tax Matters Partner determines, in its sole discretion, that such payment may be satisfied out of Company Assets available therefor which would, but for such payment, be distributed to the Member. Any amounts withheld pursuant to this Section 9.3 shall be treated as having been distributed to such Member. Each Member hereby represents that it has provided to the Company IRS Form W-9 and that it has provided and will from time to time provide such other forms or documents as may reasonably be required in order to establish the status of such Member for purposes of the tax laws of any applicable jurisdiction. Each Member agrees to indemnify and hold harmless the Company from any liability imposed on the Company for (i) any action taken by the Company in reliance upon such representation of tax withholding status or (ii) any failure to withhold from any amount distributable or allocable, or deemed distributable or allocable, to such Member pursuant to this Agreement. A Member's obligations hereunder shall survive the dissolution, liquidation or winding up of the Company. If a Governmental Authority asserts in writing to any Person that the Company failed to withhold Tax at the time and/or in the amounts required by Chapter 3 of the Code or comparable provisions of other Tax laws in respect of Photronics and/or its Affiliates, then Photronics and/or its Affiliates, as applicable, shall promptly upon receipt of a copy of such writing accompanied by a written notice from the Company specifying that a payment is required pursuant to this Section 9.3 pay to such Governmental Authority an amount in full satisfaction of the amount of Taxes so asserted by such Governmental Authority. If Photronics and its Affiliates do not promptly pay such amount to such Governmental Authority, then, unless Photronics provides satisfactory written evidence of settlement in full of the matter asserted by the Governmental Authority, the Company shall withhold such amount from the next distribution(s) to Photronics, shall promptly pay such withheld amounts over to such Governmental Authority in payment of such asserted liability for Taxes and shall treat the amounts so withheld and paid over as actually distributed to Photronics.

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               9.4 Distributions in Kind

          Subject to Section 8.5.3, no right is given to any Member to demand or receive any distribution of property other than cash as provided in this Agreement. Upon a vote of the Board of Managers and a Special Vote, the Board of Managers may determine (subject to the approval of the Special Vote) to make a distribution in kind of Company Assets to the Members, and such Company Assets shall be distributed in such fashion as to ensure that the fair market value thereof (as determined by the Board of Managers and approved by the Special Vote) is distributed, and any items of gain or loss resulting from such distribution are allocated, in accordance with this Article 9 and Articles 6 and 10 hereof.

               9.5 Limitations on Distributions

          Notwithstanding any provision to the contrary contained in this Agreement, neither the Company nor the Board of Managers, on behalf of the Company, shall be required to or shall knowingly make a distribution to any Member or the holder of any Economic Interest on account of its Membership Interest or Economic Interest in the Company (as applicable) in violation of the Act or other Applicable Law.

ARTICLE 10.
ALLOCATIONS OF NET PROFITS AND NET LOSSES

               10.1 General Allocation of Net Profits and Losses

          10.1.1 Net Profits and Net Losses shall be determined and allocated with respect to each Fiscal Year or other period of the Company as of the end of such Fiscal Year or other period and at such other times, if any, as the Board of Managers shall determine is appropriate for purposes of administering this Agreement. Subject to the other provisions of this Agreement, an allocation to a Member of a share of Net Profits or Net Losses shall be treated as an allocation of the same share of each item of income, gain, loss or deduction that is taken into account in computing Net Profits or Net Losses.

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          10.1.2 Subject to the other provisions of this Article 10, Net Profits, Net Losses and any other items of income, gain, loss and deduction for any Fiscal Year shall be allocated in proportion to the Members' respective Percentage Interests.

               10.2 Regulatory Allocations

          Notwithstanding the foregoing provisions of this Article 10, the following special allocations shall be made in the following order of priority:

          10.2.1 If there is a net decrease in Company Minimum Gain during a Company taxable year, then, to the extent required by Regulations Section 1.704-2(f), each Member shall be allocated items of Company income and gain for such taxable year (and, if necessary, for subsequent years) in an amount equal to such Member's share of the net decrease in Company Minimum Gain, determined in accordance with Regulations Section 1.704-2(g)(2). This Section 10.2.1 is intended to comply with the minimum gain chargeback requirement of Regulations Section 1.704-2(f) and shall be interpreted consistently therewith.

          10.2.2 If there is a net decrease in Member Minimum Gain attributable to a Member Nonrecourse Debt during any Company taxable year, each Member who has a share of the Member Minimum Gain attributable to such Member Nonrecourse Debt, determined in accordance with Regulations Section 1.704-2(i)(5), shall, to the extent required by Regulations Section 1.704-2(i)(4), be specially allocated items of Company income and gain for such taxable year (and, if necessary, subsequent years) in an amount equal to such Member's share of the net decrease in Member Minimum Gain attributable to such Member Nonrecourse Debt, determined in a manner consistent with the provisions of Regulations Section 1.704-2(g)(2). This Section 10.2.2 is intended to comply with the partner nonrecourse debt minimum gain chargeback requirement of Regulations Section 1.704-2(i)(4) and shall be interpreted consistently therewith.

          10.2.3 If any Member unexpectedly receives an adjustment, allocation, or distribution of the type contemplated by Regulations Section 1.704-1(b)(2)(ii)(d)(4), (5) or (6), and after receiving such adjustment, allocation, or distribution, such Member has an Adjusted Capital Account Deficit, items of income and gain shall be allocated to all such Members (in proportion to the amounts of their respective Adjusted Capital Account Deficits) in an amount and manner sufficient to eliminate the Adjusted Capital Account Deficit of such Member as quickly as possible. This Section 10.2.3 is intended to constitute a "qualified income offset" within the meaning of Regulations Section 1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith.

          10.2.4 If the allocation of Net Loss to a Member as provided in Section 10.1 would create or increase an Adjusted Capital Account Deficit for such Member, there shall be allocated to such Member only that amount of Net Loss as will not create or increase an Adjusted Capital Account Deficit. The Net Loss that would, absent the application of the preceding sentence, otherwise be allocated to such Member shall be allocated to the other Members in accordance with their relative Percentage Interests, subject to the limitations of this Section 10.2.4. If, after the allocation of Net Loss pursuant to the preceding two sentences, no additional amount of Net Loss can be allocated to any Member without creating or increasing an Adjusted Capital Account Deficit for such Member, then Net Loss shall be allocated to the Members in accordance with their relative Percentage Interests. This Section 10.2.4 is intended to implement the alternate test for economic effect set forth in Regulations Section 1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith.

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          10.2.5 To the extent that an adjustment to the adjusted tax basis of any Company Asset pursuant to Code Section 734(b) or Code Section 743(b) is required, pursuant to Regulations Section 1.704-1(b)(2)(iv)(m)(2) or Regulations Section 1.704-1(b)(2)(iv)(m)(4), to be taken into account in determining Capital Accounts as the result of a distribution to a Member in complete liquidation of its Interest in the Company, the amount of such adjustment to the Capital Accounts shall be treated as an item of gain (if the adjustment increases the basis of the asset) or loss (if the adjustment decreases such basis), and such gain or loss shall be specially allocated to the Members in accordance with their interests in the Company in the event that Regulations Section 1.704-1(b)(2)(iv)(m)(2) applies, or to the Members to whom such distribution was made in the event that Regulations Section 1.704-1(b)(2)(iv)(m)(4) applies.

          10.2.6 The Nonrecourse Deductions for each taxable year of the Company shall be allocated to the Members in proportion to their Percentage Interests.

          10.2.7 The Member Nonrecourse Deductions shall be allocated each year to the Member that bears the economic risk of loss (within the meaning of Regulations Section 1.752-2) for the Member Nonrecourse Debt to which such Member Nonrecourse Deductions are attributable.

          10.2.8 The allocations set forth in Sections 10.2.1, 10.2.2, 10.2.3, 10.2.4, 10.2.5, 10.2.6 and 10.2.7 (the "Regulatory Allocations") are intended to comply with certain requirements of Regulations Sections 1.704-1(b) and 1.704-2. Notwithstanding the provisions of Section 10.1.2, the Regulatory Allocations shall be taken into account by the Board of Managers in specially allocating other items of income, gain, loss and deduction among the Members so that, to the extent possible, the net amount of such allocations of other items and the Regulatory Allocations to each Member shall be equal to the net amount that would have been allocated to each such Member if the Regulatory Allocations had not occurred. In exercising its discretion under this Section 10.2.8, the Board of Managers shall take into account future Regulatory Allocations that, although not yet made, are likely to offset other Regulatory Allocations previously made.

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               10.3 Tax Allocations

          10.3.1 Except as provided in Section 10.3.2, for income tax purposes under the Code and the Regulations and for purposes of applicable state and local law, each Company item of income, gain, loss and deduction shall be allocated between the Members in the same manner as its correlative item of "book" income, gain, loss or deduction is allocated pursuant to this Article 10.

          10.3.2 Tax items with respect to Company Assets that are contributed to the Company with a Gross Asset Value that varies from its basis in the hands of the contributing Member immediately preceding the date of contribution shall be allocated between the Members for income tax purposes pursuant to Regulations promulgated under Code Section 704(c) or, if applicable, corresponding provisions of applicable state or local law so as to take into account such variation. The Company shall account for such variation under any permissible method under Section 704(c) as determined by the Tax Matters Partner. If the Gross Asset Value of any Company Asset is adjusted pursuant to subsection (2) of the definition of "Gross Asset Value," subsequent allocations of income, gain, loss and deduction with respect to such Company Asset shall take account of any variation between the adjusted basis of such Company Asset for federal income tax purposes and its Gross Asset Value under any permissible method under Section 704(c) as determined by the Tax Matters Partner. Any tax credits will be allocated to the Members in accordance with the requirements of applicable tax law. Allocations pursuant to this Section 10.3.2 are solely for purposes of federal, state and local taxes and shall not affect, or in any way be taken into account in computing, any Member's Capital Account or share of Net Profits, Net Losses and any other items or distributions pursuant to any provision of this Agreement.

               10.4 Other Provisions

          10.4.1 For any Fiscal Year during which any Membership Interest or Economic Interest or portion thereof is Transferred between the Members or to another Person or is otherwise disposed of or acquired, or there is for any other reason a change in the Members' respective Percentage Interests, the portion of the Net Profits, Net Losses and other items of income, gain, loss, deduction and credit with respect to such Membership Interest or Economic Interest or portion thereof shall be allocated and, to the extent necessary apportioned, under any method allowed pursuant to Section 706 of the Code and the applicable Regulations, as reasonably determined by the Board of Managers; provided, that the Board of Managers shall utilize consistent methods with respect to the same or substantially similar transactions and items in making such allocations or apportionments with respect to all such changes in the Members' respective Percentage Interests, whether occurring within a single Fiscal Year or in different Fiscal Years.

          10.4.2 In the event that the Code or any Regulations require allocations of items of income, gain, loss, deduction or credit different from those set forth in this Article 10, the Board of Managers is hereby authorized to make new allocations in reliance on the Code and such Regulations, and no such new allocation shall give rise to any claim or cause of action by any Member, provided that such allocations are consistent with the advice of the Company Accountant or tax counsel and are not likely to alter materially the amounts which each Member is entitled to receive under the terms of this Agreement.

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          10.4.3 For purposes of determining a Member's proportional share of the Company's "excess nonrecourse liabilities" within the meaning of Regulations Section 1.752-3(a)(3), each Member's interest in Net Profits shall be such Member's Percentage Interest.

          10.4.4 Section 482 Adjustments.

               (a) Company Section 482 Adjustment. If the Internal Revenue Service or any applicable state or local taxing authority reallocates an item of income, deduction or loss to the Company pursuant to Code Section 482 or any similar rule or principle of law (a "Company Section 482 Allocation"), and a Member or an Affiliate of such Member has a corresponding "correlative item," as determined under Regulations Section 1.482-1(g) (the "Member Correlative Item"), the item of income, deduction or loss constituting such Company Section 482 Allocation shall be specially allocated to and reflected in the Capital Account of the Member who received (or whose Affiliate received) such Member Correlative Item, and such Member shall be treated as making any corresponding deemed capital contribution or receiving any corresponding deemed distribution, with such deemed capital contribution or distribution, as the case may be, reflected in the Capital Account of such Member.

               (b) Member Section 482 Adjustment. If the Internal Revenue Service or any applicable state or local taxing authority reallocates an item of income, deduction or loss to a Member or an Affiliate of such Member pursuant to Code Section 482 or any similar rule or principle of law (a "Member Section 482 Allocation"), and the Company has a corresponding "correlative item," as determined under Regulations Section 1.482-1(g) (the "Company Correlative Item"), such Company Correlative Item shall be specially allocated to and reflected in the Capital Account of the Member that received (or whose Affiliate received) such Member Section 482 Allocation, and such Member shall be treated as making any corresponding deemed capital contribution or receiving any corresponding deemed distribution, with such deemed capital contribution or distribution, as the case may be, reflected in the Capital Account of such Member.

               (c) Corresponding Treatment if Foreign Adjustment. If any taxing authority outside the United States makes an adjustment to the income, deduction or loss of the Company or a Member (or an Affiliate of a Member) that is analogous to an adjustment under Code Section 482, the Board of Managers shall use commercially reasonable efforts to handle any affected items of the Company in a manner analogous to the treatment of an adjustment under Code Section 482 as set forth in Sections 10.4.4(a) and 10.4.4(b) above.

          10.4.5 The Members acknowledge and are aware of the income tax consequences of the allocations made by this Article 10 and hereby agree to be bound by the provisions of this Article 10 in reporting their shares of the Company's income and loss for federal, state and local income tax purposes. Without limiting the foregoing sentence, each Member acknowledges that, while it presently has no plan or intention to take a position in preparing a tax return that requires it to file a notice of inconsistent treatment under Code Section 6222(b), if it intends to do so in the future, it shall use its best efforts to provide at least ten (10) days advance notice of such intent to the Company and shall, if so requested by the Company, consult with the Tax Matters Partner concerning such position.

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All matters concerning the allocations and other determinations provided for in this Article 10 and any accounting procedures not expressly provided for in this Agreement shall be determined by the Board of Managers in a manner consistent with the terms and intent of this Agreement.

ARTICLE 11.
MISCELLANEOUS

               11.1 Amendments

          Any provision of this Agreement may be amended if, and only if, such amendment is in writing and is duly executed by all Members; provided, however, that amendments may be made to this Agreement from time to time by the Board of Managers, without the consent of either Member, to take such actions as may be reasonably necessary (if any) to insure that the Company will be treated as a partnership for federal income tax purposes. Upon the making of any amendment to this Agreement in accordance with the previous sentence, the Board of Managers shall prepare and file such documents and certificates as may be required under the Act and under any other Applicable Law.

               11.2 No Waiver

          Any provision of this Agreement may be waived if, and only if, such waiver is in writing and is duly executed by the party against whom the waiver is to be enforced. No failure or delay by any party in exercising any right, power or privilege under this Agreement shall operate as a waiver thereof nor shall any single or partial waiver or exercise thereof preclude the enforcement of any other right, power or privilege.

               11.3 Entire Agreement

          This Agreement, together with the other documents, exhibits and schedules referred to herein and therein, constitute the entire agreement between the parties hereto pertaining to the subject matter hereof, and supersede any and all prior oral and written, and all contemporaneous oral, agreements or understandings pertaining thereto. There are no agreements, understandings, restrictions, warranties or representations relating to such subject matter among the parties other than those set forth herein and in the other documents, exhibits and schedules referred to herein and therein.

               11.4 Further Assurances

          Each of the parties hereto does hereby covenant and agree on behalf of itself, its successors and its assigns, without further consideration, to prepare, execute, acknowledge, file, record, publish, and deliver such other instruments, documents and statements, and to take such other action as may be required by law or reasonably necessary or advisable to effectively carry out the purposes of this Agreement.

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               11.5 Notices

          Unless otherwise provided herein, all notices, requests, instructions or consents required or permitted under this Agreement shall be in writing and will be deemed given: (a) when delivered personally; (b) when sent by confirmed facsimile; (c) ten (10) Business Days after having been sent by registered or certified mail, return receipt requested, postage prepaid; or (d) three (3) Business Days after deposit with an internationally recognized commercial overnight carrier specifying next-day delivery, with written verification of receipt. All communications will be sent to the addresses listed on Exhibit A (or to such other address or facsimile number as may be designated by a party giving written notice to the other parties pursuant to this Section 11.5).

               11.6 Tax Matters

          11.6.1 Tax Matters Partner.

               (a) The Company shall file an election pursuant to Code Section 6231(a)(1)(B)(ii) to have Code Section 6231(a)(1)(B)(i) not apply. For so long as Micron and/or any of its Affiliates has an aggregate Percentage Interest greater than fifty percent (50%), Micron shall serve as the Company's "Tax Matters Partner" (as defined in Code Section 6231(a)(7)) and shall perform any similar or corresponding role under applicable state law. The Tax Matters Partner shall perform the duties imposed on a Tax Matters Partner under the Code and shall be entitled to expend Company funds for (or to be reimbursed for) reasonable third-party costs relating thereto. All legal and accounting fees relating to any audits of the Company shall be borne by the Company; provided, that the Members shall bear the costs of any audits of their separate tax returns. In the event the United States Internal Revenue Service or any other applicable Governmental Authority notifies the Tax Matters Partner of any proposed Proceeding relating to the Company's information or tax returns or to the amount of the liability of the Company for any Tax, the Tax Matters Partner shall promptly notify the other Members of such matter, shall provide relevant factual information (to the extent known) describing any asserted liability for Tax in reasonable detail and shall provide copies of any notice or other documents received from the Internal Revenue Service or other applicable Governmental Authority with respect to such matter. The Tax Matters Partner shall at all times keep the other Members informed as to the status of all such Proceedings.

               (b) The Member designated as Tax Matters Partner is hereby authorized to make all elections available to the Company for federal, state, local, and foreign tax purposes, except that in no event shall the Company file an election to be treated as a corporation or as an association taxable as a corporation for United States federal income tax purposes or for purposes of income or corporate franchise tax purposes under the law of any State of the United States.

                    (c) The Tax Matters Partner shall prepare or cause to be prepared all appropriate income and information tax returns for the Company. All such returns shall be subject to review by the other Member(s) before filing and shall be delivered to the other Member(s) for review not fewer than ten (10) Business Days in advance of the due date thereof (taking into account any extensions actually obtained). All third-party costs and expenses reasonably incurred by the Tax Matters Partner in performing its duties described in this Section 11.6 or otherwise in accordance with the terms of this Agreement (including legal and accounting fees) shall be borne by the Company. Each Member shall provide to the Tax Matters Partner such information as the Tax Matters Partner deems necessary or appropriate in connection with its activities as Tax Matters Partner. The Tax Matters Partner shall cooperate with the Members by providing to each Member such information as the Member may reasonably request concerning the Company and its transactions in connection with the determination of such Member's liability for any Tax or any Proceeding relating thereto.

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               (d) The provisions of this Section 11.6 shall survive the termination or dissolution of the Company and shall remain binding on the Members for such period of time as is necessary to resolve any and all matters regarding the Tax treatment of the Company and Tax items attributable to the Company.

          11.6.2 Standards. The Tax Matters Partner and its Affiliates shall not be liable, responsible, or accountable, in damages or otherwise, to the Company or to any other Member(s) for doing any act or failing to do any act, with respect to the Tax Matters Partner's duties set forth in this Section 11.6 or otherwise performed, the effect of which may cause or result in loss or damage to the Company or any Member(s), unless the Tax Matters Partner or one of its Affiliates engages in gross negligence or willful misconduct.

               11.7 Governing Law

          This Agreement will be governed by and construed in accordance with the laws of the State of Delaware, United States of America, as applied to agreements among Delaware residents entered into and wholly to be performed within the State of Delaware (without reference to any choice or conflicts of laws rules or principles that would require the application of the laws of any other jurisdiction).

               11.8 Construction; Interpretation

          11.8.1 Certain Terms. The words "hereof," "herein," "hereto," "hereunder" and similar words refer to this Agreement as a whole and not to any particular provision of this Agreement. The term "including" is not limited and means "including without limitation."

          11.8.2 Section References; Titles and Subtitles. Unless otherwise noted, all references to Sections and Exhibits herein are to Sections and Exhibits of this Agreement. The titles, captions and headings of this Agreement are inserted for convenience of reference only and are not intended to be a part of or to affect the meaning or interpretation of this Agreement.

          11.8.3 Reference to Persons, Agreements, Statutes. Unless otherwise expressly provided herein, (i) references to a Person include its successors and permitted assigns, (ii) references to agreements (including this Agreement) and other contractual instruments shall be deemed to include all subsequent amendments, restatements and other modifications thereto or supplements thereof and (iii) references to any statute or regulation are to be construed as including all statutory and regulatory provisions consolidating, amending, replacing, supplementing or interpreting such statute or regulation.

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          11.8.4 Presumptions. No party, nor its counsel, shall be deemed the drafter of this Agreement for purposes of construing the provisions of this Agreement, and all provisions of this Agreement shall be construed in accordance with their fair meaning, and not strictly for or against any party.

               11.9 Rights and Remedies Cumulative

          The rights and remedies provided by this Agreement are cumulative and the use of any one right or remedy by any party shall not preclude or waive its right to use any or all other remedies. Said rights and remedies are given in addition to any other rights the parties may have by law, statute, ordinance or otherwise.

               11.10 No Assignment; Binding Effect

          Except as otherwise expressly provided herein, no party may assign, delegate or otherwise transfer any of its rights or obligations hereunder to any third party, whether by assignment, transfer, Change in Control or other means, without the prior written consent of each other party. Any attempted assignment in violation of the foregoing shall be null and void. Subject to the foregoing, this Agreement shall be binding on and inure to the benefit of the Members, their heirs, executors, administrators, successors and all other Persons hereafter holding, having or receiving an interest in the Company.

               11.11 Severability

          If any provision in this Agreement will be found or be held to be invalid or unenforceable, then the meaning of said provision will be construed, to the extent feasible, so as to render the provision enforceable, and if no feasible interpretation would save such provision, it will be severed from the remainder of this Agreement which will remain in full force and effect unless the severed provision is essential and material to the rights or benefits received by any party. In such event, the parties will use their respective best efforts to negotiate, in good faith, a substitute, valid and enforceable provision or agreement which most nearly effects the parties' intent in entering into this Agreement.

               11.12 Counterparts

          This Agreement may be executed in counterparts, each of which so executed will be deemed to be an original and such counterparts together will constitute one and the same agreement. Execution and delivery of this Agreement by exchange of facsimile copies bearing the facsimile signature of a party shall constitute a valid and binding execution and delivery of this Agreement by such party.

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               11.13 Dispute Resolution

          The parties hereby agree that claims, disputes or controversies of whatever nature, arising out of, in connection with, or in relation to the interpretation, performance or breach of this Agreement (or any other agreement contemplated by or related to this Agreement), shall be first raised to the chief executive officer or another officer of each of the Members (appointed by such Member's chief executive officer) for discussion and attempt at resolution in good faith among such chief executive officers or any individuals appointed by such chief executive officers for such discussions and attempt at resolution, and if after thirty (30) days of such raising to the chief executive officers the parties are unable to come to a resolution, each of the parties shall be free to pursue any such claim, dispute or controversy in court.

               11.14 Third-Party Beneficiaries

          None of the provisions of this Agreement shall be for the benefit of or be enforceable by any creditor of the Company or by any third-party creditor of any Member. This Agreement is not intended to confer any rights or remedies hereunder upon, and shall not be enforceable by, any Person other than the parties hereto, their respective successors and permitted assigns and, solely with respect to the provision of Section 5.11, each Indemnitee and each other indemnified Person addressed therein.

               11.15 Specific Performance

          The parties agree that irreparable damage will result if this Agreement is not performed in accordance with its terms, and the parties agree that any damages available at law for a breach of this Agreement would not be an adequate remedy. Therefore, the provisions hereof and the obligations of the parties hereunder shall be enforceable in a court of equity, or other tribunal with jurisdiction, by a decree of specific performance, and appropriate injunctive relief may be applied for an granted in connection therewith. Such remedies and all other remedies provided for in this Agreement shall, however, be cumulative and not exclusive and shall be in addition to any other remedies that a party may have under this Agreement, at law or in equity.

               11.16 Consequential Damages

          No party shall be liable to any other party under any legal theory for indirect, special, incidental, consequential or punitive damages, or any damages for loss of profits, revenue or business, even if such party has been advised of the possibility of such damages (it being understood that consequential damages arising from the breach of the confidentiality restrictions set forth in the Non-Disclosure Agreement shall not be considered to fall within any such category of damages).

(Signature Page Follows)

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               IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the day and year first above written.

S-1

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EXHIBIT A
Name and Address of		Gross Asset Value of		Capital Account		Percentage		Number of Units
Members		Contributed Property		Balance		Interest
Micron Technology, Inc.						50.01%		50,010
8000 S. Federal Way
Boise, Idaho 83716-9632
Attn: Chief Operating
Officer
Fax: (208) 368-2548
With a required copy to:
General Counsel
Fax: (208) 368-4540
Photronics, Inc.						49.99%		49,990
15 Secor Road Brookfield, CT 06804 Attention: Edwin L. Lewis, Senior Vice President and General Counsel Fax: (203) 775-5601
And
15 Secor Road Brookfield, CT 06804 Attention: Sean Smith, Senior Vice President and Chief Financial Officer Fax: (203) 775-5601

A-1

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EXHIBIT B

[****]

B-1

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EXHIBIT C

Michael J. Luttati, Sean T. Smith and Christopher J. Progler.

C-1

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EXHIBIT D

INSURANCE POLICIES AT CLOSING

1.	Property Insurance: Coverage for "all risk" property insurance, insuring against physical damage on a replacement basis for assets, and insuring against resultant business interruption from physical damage on an actual-loss sustained basis. The property insurance limit must equal full replacement value of all physical property and one year business interruption insurance.
2.	Transit Insurance: Coverage for repair or replacement of capital equipment in transit up to the invoiced amount for the equipment.
3.	Liability Insurance:

• Commercial general liability insurance, including but not limited to contractual liability, personal injury, completed operations, product liability and host liquor liability, coverage for bodily injury and property damage liability, with a limit of not less than $50 million for each loss occurrence and not less than $50 million in annual aggregate coverage.
  
  
• Automobile liability coverage for bodily injury and property damage liability with a limit of not less than $10 million for each loss occurrence and not less than $10 million in annual aggregate coverage, for owned, hired, and non-owned automobiles.

4.	Workers Compensation & Employers Liability: Statutory workers compensation coverage for employees, if any, of the Company and its subsidiaries, including employers' liability coverage with a limit of not less than $10 million for each loss occurrence and $10 million in annual aggregate coverage.

D-1

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Exhibit 10.15

CONTRIBUTION AND UNITS PURCHASE AGREEMENT

          THIS CONTRIBUTION AND UNITS PURCHASE AGREEMENT (this "Agreement") is made and entered into as of May 5, 2006, by and between Micron Technology, Inc., a Delaware corporation ("Micron"), Photronics, Inc., a Connecticut corporation ("Photronics"), and MP Mask Technology Center, LLC, a Delaware limited liability company (the "Company").

          WHEREAS, Micron formed the Company to serve as the legal entity for a joint venture (the "Joint Venture") between Micron and Photronics for the development, fabrication and sale of advanced photomasks (the "Photomask Business").

          WHEREAS, in furtherance of establishing the Joint Venture, and in connection with the execution of the Limited Liability Company Operating Agreement of MP Mask Technology, LLC (the "LLC Operating Agreement") to be dated as of the Closing Date (as defined below), by and between Micron and Photronics, Micron desires to contribute hereunder as of the Closing Date (the "Contribution") to the Company the assets set forth on Schedule A hereto, which Schedule may be updated upon the reasonable agreement of Micron and Photronics, consistent with Section 6(h) below (the "Transferred Assets"), subject to the terms and conditions contained in this Agreement, in exchange for 100% of the membership interests (the "Membership Interests") of the Company.

          WHEREAS, immediately following the Contribution, Micron desires to sell 49.99% of all of the Membership Interests, represented by 49,990 units (the "Transferred Units"), of the Company to Photronics, and Photronics desires to purchase such Membership Interests from Micron, pursuant to the terms and conditions of this Agreement.

          WHEREAS, at the Closing, Micron and Photronics shall enter into the LLC Operating Agreement to set forth the respective rights and obligations of Micron and Photronics with respect to the Company, and, along with the Company, certain other Transaction Documents, as listed on Schedule B hereto.

          NOW, THEREFORE, in consideration of the promises set forth herein and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereby agree as follows:

          1. Contribution.

          (a) General. On the terms and subject to the conditions contained in this Agreement, Micron shall convey, assign, transfer and deliver to the Company, and the Company shall acquire on the Closing Date (as defined below), all of Micron's right, title and interest in and to its ownership interests in the Transferred Assets, subject to Permitted Exceptions respecting only the real property located at 3851 E. Columbia Road, Boise, Idaho (the "JV Plant"), and no other Micron assets whatsoever, in exchange for 100,000 membership units of the Company (the "Units"). "Permitted Exceptions" shall mean: (a) the lien of all ad valorem real estate Taxes (as defined below) due and payable in the calendar year 2006 and subsequent calendar years; (b) all matters of record relating to the JV Plant in the official records of the county in which such real property is located; (c) local, state and federal laws, ordinances or governmental regulations and the like, including but not limited to building and zoning laws, ordinances and regulations, now or hereafter in effect relating to the JV Plant; and (d) any matters that would be shown on an accurate survey of current date of the JV Plant.

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          (b) Contribution Closing. The closing of the contribution transactions provided for in this Agreement (the "Contribution Closing") shall take place at the offices of Micron at 8000 South Federal Way, Boise, Idaho at the opening of business on May 5, 2006 (the "Closing Date"). At the Contribution Closing, Micron shall deliver to the Company deeds, endorsements, assignments and good and sufficient instruments of conveyance, transfer and assignment as are necessary, appropriate and effective to vest in the Company all of the right, title and interest of Micron in and to the Transferred Assets and, simultaneously with such deliveries, Micron shall take such steps as are necessary to put the Company in actual possession and operating control of the Transferred Assets. On the Closing Date, the Company shall issue to Micron the Units, which shall be fully paid and nonassessable.

          (c) Assumption of Liabilities. Effective as of the Contribution Closing, the Company will assume and perform and in due course pay and discharge the following liabilities: (i) any liabilities arising out of or based upon events or circumstances occurring after the Closing in connection with or resulting from the operation of the Company's business, including product warranty claims made with respect to the sale of products by the Company after the Closing, whether or not such products were manufactured prior to the Closing; (ii) any liabilities set forth on Schedule C; (iii) any other liabilities explicitly assumed under the provisions of the Transaction Documents; and (iv) any liabilities relating to the Transferred Assets that were not Known by Micron as of the Contribution Closing (collectively, the "Assumed Liabilities"). At the Contribution Closing, the Company shall deliver to Micron appropriate assumption agreements as are necessary, appropriate and effective to assume the Assumed Liabilities. Following the Contribution Closing, Micron shall use reasonable efforts to assign and transfer all its rights, title and interest in, to and under any Assumed Contracts. To the extent any Assumed Contract (as defined below) is not capable of being transferred, assigned or conveyed without the consent or waiver of a party thereto (other than Micron or an affiliate of Micron) or any other third party (including governmental authority), or if such transfer, assignment or conveyance would constitute a breach thereof or violation of Applicable Law, this Agreement shall not constitute a transfer, assignment or conveyance thereof, and Micron shall hold any such Assumed Contract for the benefit of the Company.

          (d) Prorations. On the Closing Date, or as promptly as practicable following the Closing Date, but in no event later than sixty (60) calendar days thereafter, the water, gas electricity and other utilities, local business or other transferable license or permit fees, and other similar periodic charges payable with respect to the Transferred Assets shall be prorated between Micron and the Company, with Micron bearing such costs and expenses attributable to the period through and including the day prior to the Closing Date, and the Company bearing such costs and expenses attributable to the period after the day prior to the Closing Date.

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          (e) Taxes. Except as otherwise provided in this Agreement, (a) all Taxes (other than transfer Taxes) in respect of the Transferred Assets for the period or portions of periods ending at or prior to the day prior to the Closing Date shall be borne solely by Micron ("Micron Pre-Closing Taxes"). For purposes of the foregoing, any Taxes that are imposed on a periodic basis and are payable for a Tax period that includes (but does not end on) the day prior to the Closing Date (a "Straddle Period"), the portion of such Tax that relates to the portion of such Tax period ending on the day prior to the Closing Date shall (A) in the case of any Taxes other than Taxes based upon or related to income or receipts, be deemed to be the amount of such Tax for the entire Tax period multiplied by a fraction, the numerator of which is the number of days in the Tax period ending on the day prior to the Closing Date and the denominator of which is the number of days in the entire Tax period, and (B) in the case of any Tax based upon or related to income or receipts, be deemed equal to the amount which would by payable if the relevant Tax period ended on the day prior to the Closing Date. For purposes of this Section, all relevant periods in respect of personal property, real property and similar Taxes imposed by the State of Idaho shall be treated as beginning after the day prior to the Closing Date, and such Taxes in respect of the Transferred Assets shall be paid by the Company. Micron shall pay to the Company, within fifteen (15) days prior to the date on which Taxes are due with respect to Straddle Periods, that amount equal to the applicable portion of such Taxes which relates to the portion of such Taxable period ending on the day prior to the Closing Date. Except as otherwise provided in this Agreement, all Taxes in respect of the Transferred Assets for the period or portions of periods beginning after the day prior to the Contribution Closing shall be borne by the Company or, to the extent that the Company is taxed as a flow-through entity, with respect to income or franchise Taxes, by the Members. "Tax" means all taxes, levies, imposts and fees imposed by any Governmental Authority (domestic or foreign) of any nature, including but not limited to federal, state, local or foreign net income tax, alternative or add-on minimum tax, profits or excess profits tax, franchise tax, gross income, adjusted gross income or gross receipts tax, employment related tax (including employee withholding or employer payroll tax, FICA or FUTA), real or personal property tax or ad valorem tax, sales or use tax, excise tax, stamp tax or duty, any withholding or back up withholding tax, value added tax, severance tax, prohibited transaction tax, premiums tax, occupation tax, together with any interest or any penalty, addition to tax or additional amount imposed by any Governmental Authority (domestic or foreign) responsible for the imposition of any such tax.

          2. Purchase and Sale of Membership Interests.

          (a) General. At the LLC Closing (as defined below) and upon the terms and conditions set forth in this Agreement, Micron shall sell, transfer and assign to Photronics, and Photronics shall purchase and acquire from Micron, the Transferred Units, free and clear of all security interests, claims, liens, pledges, options, encumbrances, charges, agreements, voting trusts, proxies and other arrangements or restrictions whatsoever, except as may be set forth in this Agreement and the LLC Operating Agreement. Capitalized terms used, but not defined, in this Agreement, shall have the meanings set forth in the LLC Operating Agreement.

          (b) Purchase Price. The total purchase price to be paid by Photronics for the Units will be $63,000,000 (the "Purchase Price").

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          (c) Closing; Subsequent Payments. Subject to the terms and conditions contained in this Agreement, the purchase and sale of the Units hereunder (the "LLC Closing" and together with the Contribution Closing, the "Closing") shall take place immediately following the Contribution Closing at the offices of Micron at the opening of business on May 5, 2006 (the "Closing Date"), or at such other place or on such other date as is mutually agreeable to Micron and Photronics. [****]. In addition, Photronics shall make two additional payments to Micron in payment for the balance of the Purchase Price by delivery to Micron, by wire transfer of immediately available funds to a bank account designated in writing by Micron, of an amount equal to $7,500,000, on each of the first and second anniversaries of the Closing Date.

          3. Closing Conditions.

          (a) The obligation of Micron to sell, transfer and assign the Units to Photronics hereunder is subject to the satisfaction of the following conditions as of the Closing:

          (i) the representations and warranties contained in Section 4 hereof shall be true and correct in all material respects at and as of the date hereof and at and as of the Closing Date as though then made, except to the extent of changes caused by the transactions expressly contemplated herein;

          (ii) Micron shall have received the portion of the Purchase Price payable to Micron at the Closing pursuant to Section 2 above;

          (iii) The agreements and covenants of Photronics contained in this Agreement that are required to be performed prior to or on the Closing Date shall have been performed or satisfied by Photronics in all material respects;

          (iv) Consummation of the transactions contemplated hereby and by the Transaction Documents shall not have been restrained, enjoined or otherwise prohibited by Applicable Law or order of judgment or any Governmental Authority (as defined in the LLC Operating Agreement); and

          (v) Micron and Photronics shall have entered into the LLC Operating Agreement and the other Transaction Documents, and such agreements shall be in full force and effect.

          (b) The obligation of Photronics to purchase and acquire the Units from Micron is subject to the satisfaction of the following conditions as of the Closing:

          (i) the representations and warranties contained in Section 4 hereof shall be true and correct in all material respects at and as of the date hereof and at and as of the Closing Date as though then made, except to the extent of changes caused by the transactions expressly contemplated herein;

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          (ii) The agreements and covenants of Micron contained in this Agreement that are required to be performed prior to or on the Closing Date shall have been performed or satisfied by Micron in all material respects;

          (iii) The Contribution shall have occurred;

          (iv) Consummation of the transactions contemplated hereby and by the Transaction Documents shall not have been restrained, enjoined or otherwise prohibited by Applicable Law or order of judgment or any Governmental Authority; and

          (v) Micron and Photronics shall have entered into the LLC Operating Agreement and the other Transaction Documents, and such agreements shall be in full force and effect.

          4. Representations and Warranties of Micron. Micron hereby represents and warrants to Photronics as follows:

          (a) Organization. Each of Micron and the Company is duly organized, validly existing and in good standing under the laws of its jurisdiction of formation. Micron has all corporate power and authority required to conduct its business as currently conducted and to own and lease its properties and operate its business as currently owned, leased and operated. The Company has all limited liability company power and authority required to conduct its business as currently conducted and to own and lease its properties and operate its business as currently owned, leased and operated. Each of Micron and the Company is duly qualified to do business and is in good standing (to the extent such concept exists in the relevant jurisdiction) as a foreign corporation or limited liability company, as applicable, in each jurisdiction where the character of the property owned or leased or the nature of its activities makes such qualification necessary, except for those jurisdictions where the failure to be so qualified or in good standing is not reasonably likely to result in a Material Adverse Effect on Micron or the Joint Venture, as applicable. A "Material Adverse Effect" on a Person (as defined in the LLC Operating Agreement) or business shall mean any facts or circumstances that, individually or in the aggregate, would, or might reasonably be expected to, result in a material adverse effect on the business, financial condition or results of operations of such Person or business.

          (b) Ownership. All of the Membership Interests of the Company are owned by Micron, and Micron has good and marketable title to such Membership Interests, which consists of 100,000 units, free and clear of all security interests, claims, liens, pledges, options, encumbrances, charges, agreements, voting trusts, proxies and other arrangements or restrictions whatsoever.

          (c) Authorization. Micron has all requisite corporate power and corporate authority to execute and deliver this Agreement, to perform all of its obligations and undertakings hereunder and to consummate the transactions contemplated hereby. The execution and performance of this Agreement and the sale of the Units by Micron to Photronics have been duly authorized by all necessary action on the part of Micron, and this Agreement has been duly authorized, executed and delivered by Micron and constitutes a valid and legally binding obligation of Micron, enforceable in accordance with its terms, except as the enforceability thereof may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors' rights generally and general equitable principles.

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          (d) Conflicts. The execution, delivery and performance of this Agreement by Micron or the Company does not conflict with, violate or result in the breach of, or create any lien or encumbrance on the Transferred Assets or the Membership Interests of the Company pursuant to, any charter, agreement, instrument, order, judgment, decree, law or governmental regulation to which Micron is a party or is subject or by which the Transferred Assets or the Membership Interests of the Company are bound. The execution, delivery and performance of this Agreement does not and will not require any governmental or other third party consents or filings on the part of Micron or the Company.

          (e) Transferred Assets. [****]. The Company has, except for Permitted Exceptions, (i) good and marketable title to, and possession of, all of the owned Transferred Assets that are real property and (ii) good and valid title to all of the owned Transferred Assets that are not real property. All of the Transferred Assets are in good operating condition and repair, ordinary wear and tear and immaterial defects excepted. The Company has no assets other than the Transferred Assets and the rights under the Technology License Agreement (as defined in the LLC Operating Agreement).

          (f) Litigation. To Micron's Knowledge, there is no material Proceeding pending or threatened against, relating to or affecting the Transferred Assets or the transactions contemplated by this Agreement. "Micron's Knowledge" and the related term "Known by Micron" shall mean the actual knowledge of the executive officers of Micron, after due inquiry of the operating officers of Micron and the Company. "Proceeding" shall mean any action, suit, hearing, arbitration, proceeding (public or private), investigation, examination, audit or claim.

          (g) Environmental Matters. Except as would not reasonably be expected to have a Material Adverse Effect on the Company, to Micron's Knowledge: (i) Micron's operation of the Transferred Assets has complied with all Environmental Laws; and (ii) no real property constituting a Transferred Asset contains any Hazardous Substance which could be expected to require investigation or remediation under any Environmental Law. "Environmental Law" shall mean any law, regulation, order, decree, common law or agency requirement relating to the protection of the environment or human health and safety. "Hazardous Substance" shall mean any substance that is listed, classified or regulated in any concentration under any Environmental Law including petroleum products and polychlorinated biphenyls.

          (h) Contracts. All material contracts or other material agreements assigned to the Company by Micron in connection with the transactions contemplated by this Agreement are set forth on Exhibit C hereto (the "Assumed Contracts") and are in full force and effect and constitute the valid and legally binding obligations of the Company, enforceable in accordance with their terms, except as the enforceability thereof may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors' rights generally and general equitable principles. Micron is not in material default under, and to Micron's Knowledge, no other party is in material default under, any of the Assumed Contracts.

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          (i) Sufficiency of Assets. To Micron's Knowledge, upon the execution of, and consummation of the transactions contemplated by, this Agreement, the Contribution Agreement and the other Transaction Documents, (i) the tangible assets and properties of the Company as of the Closing Date will include all of the material tangible assets and properties necessary for the conduct of the Company's Photomask Business as conducted by Micron immediately prior to the Closing (not including assets used by Micron in connection with its performance of services under the Information Technology, Operational and General Administrative Services Agreement between Micron and the Company (the "Services Agreement")) and (ii) the services to be performed by Micron pursuant to the Services Agreement encompass services sufficient for the continued conduct of Micron's Photomask Business as conducted by Micron immediately prior the Closing. All of the material machinery and equipment located at the JV Plant as of the date hereof constitute Transferred Assets (not including (i) assets used by Micron in connection with its performance of services under the Services Agreement and (ii) assets used by non-Micron field service personnel in connection with their performance of services for the Company).

          (j) Undisclosed Liabilities. To Micron's Knowledge, Micron's Photomask Business is not subject to any material liability, whether absolute, contingent, accrued or otherwise, which is not shown or which is in excess of amounts shown or reserved for in the unaudited balance sheet of Micron's Photomask Business dated as of the date hereof and provided to Photronics on the date hereof, which balance sheet has been prepared from, and is consistent with, the books and records of Micron.

          (k) Permits. To Micron's Knowledge, it operates Micron's Photomask Business and the Transferred Assets with all required material Governmental Authority approvals, permits and licenses and is in compliance with all material terms thereof.

          (l) No Material Adverse Effect. Since March 2, 2006, there has not been any Material Adverse Effect on Micron's Photomask Business.

          (m) Compliance with Laws. Micron is in compliance in all material respects with all Applicable Laws relating to or applicable to the conduct of Micron's Photomask Business and the ownership and use of the Transferred Assets.

          (n) Title Insurance. Micron has provided Photronics with true and complete copies of the Micron Title Insurance Policies. To Micron's knowledge, each of the Micron Title Insurance Policies is, and as of the Closing will be, in full force and effect according to its terms.

          (o) Brokers and Finders. Micron has not engaged any broker or finder in connection with this transaction.

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          5. Representations and Warranties of Photronics. Photronics hereby acknowledges, represents and warrants to Micron as follows:

          (a) Organization. Photronics is duly organized, validly existing and in good standing under the laws of its jurisdiction of formation. Photronics has all corporate power and authority required to conduct its business as currently conducted and to own and lease its properties and operate its business as currently owned, leased and operated. Photronics is duly qualified to do business and is in good standing (to the extent such concept exists in the relevant jurisdiction) as a foreign corporation or limited liability company, as applicable, in each jurisdiction where the character of the property owned or leased or the nature of its activities makes such qualification necessary, except for those jurisdictions where the failure to be so qualified or in good standing is not reasonably likely to result in a Material Adverse Effect on Photronics.

          (b) Authorization. Photronics has all requisite corporate power and corporate authority to execute and deliver this Agreement, to perform all of its obligations and undertakings hereunder and to consummate the transactions contemplated hereby. The execution and performance of this Agreement and the purchase of the Units by Photronics from Micron have been duly authorized by all necessary action on the part of Photronics, and this Agreement has been duly authorized, executed and delivered by Photronics and constitutes a valid and legally binding obligation of Photronics, enforceable in accordance with its terms, except as the enforceability thereof may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors' rights generally and general equitable principles.

          (c) Conflicts. The execution, delivery and performance of this Agreement by Photronics does not conflict with, violate or result in the breach of any charter, agreement, instrument, order, judgment, decree, law or governmental regulation to which Photronics is a party or is subject. The execution, delivery and performance of this Agreement does not and will not require any governmental or other third party consents or filings either on the part of Photronics.

          (d) Investment Representations.

          (i) Photronics is acquiring the Units for investment purposes and is not acquiring the Units with a view to the public sale or distribution of any part thereof, and Photronics has no present intention of selling, granting participation in, or otherwise distributing the Units in violation of any federal or state securities laws. Photronics recognizes that it must bear the economic risk of the investment represented by its purchase of the Units for an indefinite period according to the terms of the LLC Operating Agreement. Photronics understands that the Units have not been registered under the Securities Act of 1933 on the basis that the sale provided for in this Agreement is exempt under the Act and that the reliance of Micron on such exemptions is predicated upon such Photronics' representations set forth herein.

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          (ii) Photronics acknowledges and agrees that any certificates representing Units held by Photronics, and the LLC Operating Agreement, will be affixed with the following legend:

"MEMBERSHIP INTERESTS IN MP MASK TECHNOLOGY CENTER, LLC, A DELAWARE LIMITED LIABILITY COMPANY, HAVE NOT BEEN REGISTERED WITH OR QUALIFIED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY SECURITIES REGULATORY AUTHORITY OF ANY STATE. THE INTERESTS ARE BEING SOLD IN RELIANCE UPON EXEMPTIONS FROM SUCH REGISTRATION OR QUALIFICATION REQUIREMENTS. THE INTERESTS CANNOT BE SOLD, TRANSFERRED, ASSIGNED OR OTHERWISE DISPOSED OF EXCEPT IN COMPLIANCE WITH THE RESTRICTIONS ON TRANSFERABILITY CONTAINED IN THE LIMITED LIABILITY COMPANY OPERATING AGREEMENT OF MP MASK TECHNOLOGY CENTER, LLC AND APPLICABLE FEDERAL AND STATE SECURITIES LAWS."

          (iii) Photronics hereby acknowledges that Micron has provided to Photronics no information regarding the Company, or its business, prospects or value, and is making no representations other than those in Section 4 hereof. Photronics further acknowledges that it has conducted an independent investigation and has been given access by the Company or parties unrelated to Micron to all information regarding the Company that it has requested, but such investigation shall not relieve Micron on liability for breaches of representations and warranties made by Micron in Section 4. Photronics is capable of evaluating and has evaluated the merits and risks of its acquisition of the Units.

          (iv) Photronics hereby acknowledges that Micron is relying on the representations contained in this Agreement in engaging in the sale of the Membership Interests of the Company and would not engage in the sale of the Membership Interests of the Company in the absence of the representations contained in this Agreement.

          (e) Brokers and Finders. Photronics has not engaged any broker or finder in connection with this transaction.

          6. Covenants.

          (a) Operations Prior to the Closing Date. Prior to the Closing Date, Micron shall operate Micron's Photomask Business and the Transferred Assets in the ordinary course and substantially as presently operated.

          (b) No Sale of Assets. Except for the sale of inventory in the ordinary course of business and the disposition of broken or obsolete assets, Micron will not, directly or indirectly, (a) solicit any inquiries or proposals or enter into or continue any discussions, negotiations or agreements relating to the direct or indirect transfer of the Transferred Assets to any Person other than the Company or (b) provide any assistance or any information to or otherwise cooperate with any Person in connection with any such inquiry proposal or transaction.

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          (c) Diligence in Pursuit of Closing. Each of the parties hereto shall use all commercially reasonable efforts to fulfill their respective obligations hereunder and under the other Transaction Documents, and shall reasonably cooperate with the other parties in regard to the same in order to effect the Closing.

          (d) Maintenance of Insurance. Prior to the Closing, Micron shall not take or fail to take any action that would adversely affect the applicability and the extent of coverage of any insurance in effect on the date hereof, in any material respect, that covers all or any part of the Transferred Assets, as and to the extent such insurance applies to and covers insured risks for periods prior to the Closing Date.

          (e) Confidentiality. The disclosure and exchange of information between Micron and Photronics is governed solely by the terms of the Micron Technology, Inc. Mutual Nondisclosure Agreement dated as of March 29, 2005, as amended, and by the Nondisclosure Agreement among Micron, Photronics and the Company included as part of the Transaction Documents (the "Confidentiality Agreements").

          (f) Press Releases. The parties agree that, following the signing of this Agreement, they shall issue a joint press release, the text of which shall have been pre-approved by Micron and Photronics. Except as required by law or regulation, prior to the issuance of such press release, none of the parties hereto shall make any public disclosure, announcement or statement with respect to this Agreement, the Transaction Documents or the Joint Venture or any of the transactions contemplated by this Agreement or the Transaction Documents.

          (g) Title. Micron covenants that following the Closing Date, Micron, without cost to Micron but for the benefit of the Company, will diligently and reasonably present and prosecute to the fullest extent of available coverage claims under the policies of title insurance, and riders and endorsements thereto, issued effective upon Micron's acquisition of fee simple title to the real property constituting Transferred Assets (the "Micron Title Insurance Policy") with respect to any claim, action, loss or damage affecting such property that the Company may assert against Micron. Micron agrees to pay over to the Company any proceeds paid to Micron in respect of Micron's claims asserted under the Micron Title Insurance Policy to the extent related to the real property constituting Transferred Assets.

          (h) Opening Balance Sheet. [****]. If the net asset value of the Transferred Assets on the Opening Balance Sheet is less than the NAV Amount, then Micron shall promptly wire an amount of cash equal to such deficiency to the Company. If the net asset value on the Opening Balance Sheet is greater than the NAV Amount, then the Company shall promptly wire an amount equal to such excess to Micron.

          7. Survival of Representations and Warranties. All representations and warranties contained herein or made in writing by any party in connection herewith shall survive the execution and delivery of this Agreement and the Closing hereunder for a period of one (1) year following the Closing Date, except for the representations and warranties set forth in Sections 4(b) and 4(c) and the second sentence of Section 4(e), which shall survive the execution and delivery of this Agreement and the Closing for a period of ten years following the Closing Date.

10

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          8. Indemnification.

          (a) Agreement to Indemnify.

          (i) Micron agrees to indemnify and hold harmless Photronics and each of its representatives and affiliates (including the Company) (each a "Photronics Indemnified Party") against any and all liabilities, claims, demands or losses, including reasonable attorneys' fees incurred by any Photronics Indemnified Party arising out of, or resulting from, (u) any breach of any representation or warranty made by Micron in this Agreement or any other certificate delivered by Micron pursuant to this Agreement, (v) any breach of any covenant made by Micron in this Agreement or any other certificate delivered by Micron pursuant to this Agreement, (w) any known liabilities of Micron's Photomask Business not assumed by the Company pursuant to the Transaction Documents, (x) any Pre-Closing Environmental Matter or (y) any products distributed by Micron prior the Closing. "Pre-Closing Environmental Matter" shall mean (a) the production, use, generation, emission, storage, treatment, transportation, recycling, disposal, discharge, release or other handling or disposition at any time on or prior to the Closing Date of any Hazardous Substances on, from or under any real property included in the Transferred Assets by Micron or any affiliate of Micron or (b) the failure prior to the Closing Date by Micron or any affiliate of Micron to operate the business on any real property included in the Transferred Assets in compliance with any Environmental Law.

          (ii) Photronics agrees to indemnify and hold harmless Micron and each of its representatives and affiliates (including the Company) (each a "Micron Indemnified Party") against any and all liabilities, claims, demands or losses, including reasonably attorneys' fees, incurred by any Micron Indemnified Party arising out of, or resulting from, (u) any breach of any representation or warranty made by Photronics in this Agreement or any other certificate delivered by Photronics pursuant to this Agreement or (v) any breach of any covenant made by Photronics in this Agreement or any other certificate delivered by Photronics pursuant to this Agreement.

          (b) Limitations on Indemnification.

          (i) [****].

          (ii) [****].

          (iii) After the Closing, with respect to any matter as to which indemnification is provided pursuant to Section 8 of this Agreement, such indemnification shall be the sole remedy available to a Photronics Indemnified Party or Micron Indemnified Party, as the case may be; provided, however, that this Section 8(b)(iii) shall not limit any party's rights to bring a claim, action or suit for fraud or bad faith.

11

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          (c) Indemnification Procedures. In the event a Photronics Indemnified Party or a Micron Indemnified Party intends to make a claim for indemnification hereunder on behalf of himself or any Photronics Indemnified Party or Micron Indemnified Party, respectively (an "Indemnitee"), such party shall notify whichever of Micron or Photronics against whom indemnity is being sought (the "Indemnitor") of the claim in writing promptly (but in no event later than thirty (30) days) after receiving written notice of any action, lawsuit, proceeding, investigation or other claim against him (if by a third party) or discovering the liability, obligation or facts giving rise to such claim for indemnification, describing the claim, the amount thereof (if known and quantifiable), and the basis thereof, provided that the failure to so notify the Indemnitor shall not relieve the Indemnitor of his obligations hereunder except to the extent such failure shall have actually prejudiced the Indemnitor. The Indemnitor shall be entitled to assume and control (with counsel of its choice) the defense of the action, lawsuit, proceeding, investigation or other claim giving rise to Indemnitee's claim for indemnification at the option and expense of the Indemnitor by sending written notice of its election to do so within fifteen (15) days after receiving written notice of such claim from the Indemnitee as aforesaid; provided, however, that:

          (i) The Indemnitee shall be entitled to participate in the defense of such claim and to employ counsel of its choice for such purpose, the fees and expenses of such separate counsel which shall be borne by the Indemnitee;

          (ii) If the Indemnitor elects to assume the defense of any such claim, the Indemnitor shall be entitled to compromise or settle such claim so long as either (x) such settlement provides an unconditional release of all Indemnitees with respect to such claim and requires the payment of monetary damages only or (y) the Indemnitor obtains the prior written consent of the Indemnitee (which consent shall not be unreasonably withheld or delayed); and

          (iii) If the Indemnitor shall not have assumed the defense of such claim within the 15-day period set forth above, the Indemnitee may assume the defense of such action, lawsuit, proceeding, investigation or such other claim with counsel selected by it (which counsel shall be reasonably acceptable to the Indemnitor) at the expense of the Indemnitor, provided that the Indemnitee shall under no circumstances settle or compromise such claim without the prior written consent of the Indemnitor (which consent shall not be unreasonably withheld or delayed).

          9. Termination. This Agreement may be terminated at any time prior to the Closing (a) by mutual written consent of the parties hereto or (b) if the Closing does not occur prior to July 1, 2006, provided that no party shall be entitled to terminate this Agreement pursuant to this clause (b) if such party is in breach of any provision hereof or if the Closing has not occurred despite the satisfaction of the conditions to such party's obligation to close. In the event of the termination of this Agreement pursuant to this Section 9, this Agreement shall become void and of no further force and effect, there shall be no liability under this Agreement and all rights and obligations of each party hereto shall cease, provided that nothing herein shall relieve any party from liability for, or be deemed to waive any rights available to a party by reason of, any breach by the other party or parties of its or their representations, warranties, covenants or agreements set forth in this Agreement. If the Closing does occur, this Agreement may not be terminated thereafter by either party without the prior written consent of the other.

12

**** Material omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Exchange Act of 1934. Material filed separately with the Securities and Exchange Commission.

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          10. Further Assurances. After the Closing, as and when requested by Photronics, Micron shall execute and deliver all such instruments of conveyance and transfer and shall take such further actions as Photronics may deem reasonably necessary to transfer the Units to Photronics and to carry out fully the provisions and purposes of this Agreement. After the Closing, as and when requested by Micron, Photronics shall take such further actions as Micron may deem reasonably necessary to carry out fully the provisions and purposes of this Agreement.

          11. Miscellaneous.

          (a) Successors and Assigns. This Agreement is intended to bind and inure to the benefit of and be enforceable by Micron and Photronics and their respective successors and assigns. This Agreement may not be assigned by either party hereto without the prior written consent of the other party to this Agreement, which consent shall not be unreasonably withheld.

          (b) Amendment. This Agreement may be amended only through a writing signed by all parties hereto.

          (c) Entire Agreement and Modification. This Agreement and all agreements between Micron and Photronics entered into concurrently herewith, including the LLC Operating Agreement and the other Transaction Documents, together with the Confidentiality Agreements, constitute and contain the entire agreement of the parties and supersede and preempt any and all prior negotiations, correspondence, understandings, agreements and representations, written or oral, which may have related to the subject matter hereof.

          (d) Choice of Law. The construction, validity, interpretation and enforcement of this Agreement shall be governed by the internal law, and not the law of conflicts, of the State of Delaware. EACH OF THE PARTIES HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT. EACH OF THE PARTIES HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF THE OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT THE OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT THE PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 8(d).

13

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          (e) Enforcement. If any portion of this Agreement shall be determined to be unenforceable for any reason, it shall be adjusted rather than voided, if possible, in order to achieve the intent of the parties to the extent possible. In any event, all other provisions of this Agreement shall be valid and enforceable to the maximum extent possible.

          (f) Headings. The headings appearing in this Agreement have been inserted for identification and reference purposes and shall not by themselves determine the construction or interpretation of this Agreement.

          (g) Notices. Unless otherwise provided herein, all notices, requests, instructions or consents required or permitted under this Agreement shall be in writing and will be deemed given: (a) when delivered personally; (b) when sent by confirmed facsimile; (c) ten (10) business days after having been sent by registered or certified mail, return receipt requested, postage prepaid; or (d) three (3) business days after deposit with an internationally recognized commercial overnight carrier specifying next day delivery, with written verification of receipt. All communications will be sent to the addresses listed on Exhibit A to the LLC Operating Agreement (or to such other address or facsimile number as may be designated by a party giving written notice to the other parties pursuant to Section 11.5 of the LLC Operating Agreement).

          (h) Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed to be an original, but all of which taken together shall constitute one and the same agreement.

          (i) Expenses. Except as otherwise provided herein, each party shall pay all costs and expenses that it incurs with respect to the negotiation, execution, delivery, performance and consummation of this Agreement, except that the Company shall pay any transfer Taxes, recording and filing fees, and other charges with respect to the transfer of the Transferred Assets at the Contribution Closing.

(signature page follows)

14

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          IN WITNESS WHEREOF, the parties have executed this Agreement on the day and year first above written.

	MICRON TECHNOLOGY, INC.
	By:
	Name:
	Title:
	PHOTRONICS, INC.
	By:
	Name:
	Title:
	MP MASK TECHNOLOGY CENTER, LLC
	By:
	Name:
	Title:

**** Material omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Exchange Act of 1934. Material filed separately with the Securities and Exchange Commission.

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Schedule A

Transferred Assets

[****]

**** Material omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Exchange Act of 1934. Material filed separately with the Securities and Exchange Commission.

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Schedule B

Transaction Documents

Contribution and Units Purchase Agreement among Micron, Photronics and the Company

Limited Liability Company Operating Agreement between Micron and Photronics

Company to Micron Direct Supply Agreement between Micron and the Company

Company to Photronics Supply Agreement between Photronics and the Company

Photronics to Micron Supply Agreement between Micron and Photronics

Technology License Agreement among Micron, Photronics and the Company

Information Technology, Operational and General Administrative Services Agreement between Micron and the Company

Operational and General Administrative Services Agreement between Photronics and the Company

Nondisclosure Agreement among Micron, Photronics and the Company

Non-solicitation Agreement among Micron, Photronics and the Company

Assignment and Assumption Agreement between Micron and the Company

Bill of Sale between Micron and the Company

Warranty Deed between Micron and the Company

Build to Suit Lease between Micron and Photronics

2

**** Material omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Exchange Act of 1934. Material filed separately with the Securities and Exchange Commission.

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Schedule C

Assumed Contracts and Assumed Liabilities

[****]

3

**** Material omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Exchange Act of 1934. Material filed separately with the Securities and Exchange Commission.

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Exhibit 10.16

TECHNOLOGY LICENSE AGREEMENT

     This TECHNOLOGY LICENSE AGREEMENT (the "Agreement"), made this 5th day of May, 2006 (the "Effective Date"), is by and among MICRON TECHNOLOGY, INC., a Delaware corporation ("Micron"), PHOTRONICS, INC., a Connecticut corporation ("Photronics") and MP MASK TECHNOLOGY CENTER, LLC, a Delaware limited liability company (the "Company").

RECITALS

     WHEREAS, Micron and Photronics have formed the Company to develop and fabricate advanced Reticles primarily dedicated to supporting Micron's prototype and production Reticle requirements as directed by Micron and pursuant to the Limited Liability Company Operating Agreement of even date herewith (the "Operating Agreement") by and between Micron and Photronics;

     WHEREAS, Micron and Photronics own certain technology assets that each will license pursuant to the terms and conditions of this Agreement (i) to the Company so that the Company may fulfill its Objectives (defined below) and (ii) to each other for the purposes set forth herein; and

     WHEREAS, Micron, Photronics and the Company have entered into separate supply agreements under which Micron and Photronics will be able to obtain the Reticles developed and fabricated using the technology licensed hereunder.

     NOW, THEREFORE, in consideration of the promises contained, and of the obligations herein made and undertaken, the parties hereto do hereby covenant and agree follows:

1. DEFINITIONS

     For purposes of this Agreement, the definitions set forth in this Section 1 shall apply to the respective capitalized terms. All capitalized terms not defined in this Agreement shall have the meaning set forth in the Operating Agreement.

     1.1 "Approved Technology" shall mean (i) all Technology and Software initially provided by Micron or Photronics to the Company hereunder in accordance with Section 3, and (ii) all other Technology and Software that has been approved by the Technology Steering Committee for use in the Company.

     1.2 "Company Improvements" shall mean (i) all Improvements made by or for the Company to any of the Micron Technology, Micron Software or the Photronics Technology; (ii) all documentation, works of authorship, know-how, data and data bases, formulae, algorithms, processes, inventions and discoveries (whether or not patentable), Software, ideas, concepts, techniques, methods, content, technical information; engineering, production and other designs; drawings, schematics, tooling requirements, and other information, technology and materials, tangible or intangible, conceived, created, developed, first fixed in a tangible medium or first reduced to practice by, for or at the Company; and (iii) all Intellectual Property Rights in each of the foregoing.

**** Material omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Exchange Act of 1934. Material filed separately with the Securities and Exchange Commission.

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     1.3 "Competing Product" means [****].

     1.4 "Copy Critical" shall refer to [****]

     1.5 "Copy Exact" shall refer [****].

     1.6 "Designated Facility" means [****]

     1.7 "Improvements" shall mean all derivative works of, improvements upon and modifications to Technology.

     1.8 "Intellectual Property Right" means any patents, patent applications, including with respect to patents any patent rights granted upon any reissue, division, continuation or continuation-in-part applications now or hereafter filed, or utility models issued or pending, any registered and unregistered design rights, any copyrights (including the copyright on Software), trade secrets, know-how, or any other intellectual property rights or proprietary rights whether registered or unregistered, and whether now known or hereafter recognized in any jurisdiction, excluding trade names, service names, trademarks, service marks, and trade dress.

     1.9 "Licensed Technology" shall mean the New Technology, Standard Technology and Unrestricted Technology, as applicable. All Company Improvements shall be considered Licensed Technology, subject to classification thereof by the Technology Steering Committee in accordance with Section 3.4.

     1.10 "Micron Intellectual Property Rights" shall mean all Intellectual Property Rights (i) owned by Micron or sublicenseable by Micron on the terms of this Agreement without obligation to pay additional consideration to a licensor; and (ii) necessary or useful to fulfill the Objectives or to design, develop or manufacture Reticles, including any Intellectual Property Rights assigned by the Company to Micron in accordance with this Agreement.

     1.11 "Micron Software" shall mean the Software owned by Micron that Micron provides to either the Company or to Photronics in accordance with this Agreement.

     1.12 "Micron Technology" shall mean all Technology (i) owned by Micron or sublicenseable by Micron to the Company or to Photronics on the terms of this Agreement without obligation to pay additional consideration to a licensor; and (ii) necessary or useful to fulfill the Objectives or to design, develop or manufacture Reticles, including any Company Improvements owned by Micron pursuant to this Agreement.

     1.13 "New Photronics Facility" means the new Photronics Facility to be built pursuant to the Transaction Documents in Boise, Idaho.

     1.14 "New Technology" shall mean [****].

2

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     1.15 "Objectives" shall mean the following business purposes for which the Company has been created and for which the Company is licensed hereunder: (i) to develop and produce prototypes for advanced, next-generation, high-end Reticles that meet Micron's specifications as provided to the Company from time to time; (ii) to achieve sustainable, leading edge production capabilities using only Approved Technology; (iii) to manufacture in production volumes approved Reticles for Micron that meet Micron's specifications and fulfill Micron's Reticle requirements; and (iv) to the extent the Company has excess capacity after fulfilling all of Micron's Reticle requirements as set forth above, and as permitted herein and pursuant to the Supply Agreement between the Company and Photronics, manufacture prototype and production Unrestricted Reticles for Photronics customers using only Approved Technology. These Objectives may be changed in accordance with the procedures set forth in the Operating Agreement.

     1.16 "Photronics Controlled Subsidiary" means a subsidiary of Photronics that is primarily in the business of developing and fabricating Reticles and that is directly, or indirectly through one or more intermediaries, [****], and that is controlled by Photronics.

     1.17 "Photronics Facility" shall mean [****].

     1.18 "Photronics Improvements" means Improvements made by Photronics to Micron Technology, but not including Improvements made by Photronics employees or subcontractors while providing services to the Company.

     1.19 "Photronics Intellectual Property Rights" shall mean all Intellectual Property Rights (i) owned by Photronics or sublicenseable by Photronics on the terms of this Agreement without obligation to pay additional consideration to a licensor; and (ii) necessary or useful to fulfill the Objectives or to design, develop or manufacture Reticles.

     1.20 "Photronics Technology" shall mean all Technology (i) owned by Photronics or sublicenseable by Photronics to the Company or to Micron on the terms of this Agreement without obligation to pay additional consideration to a licensor, and (ii) necessary or useful to fulfill the Objectives or to design, develop or manufacture Reticles.

     1.21 "Process Node" means a specific geometry loosely based on a minimum line width at which semiconductor integrated circuit devices, and the Reticles used in the manufacture of those devices, are manufactured; e.g., [****].

     1.22 "Qualified" shall mean [****].

     1.23 "Reticle" means a photomask, template or reticle that can be used to transfer an image to a wafer or workpiece.

     1.24 "Software" shall mean computer program instruction code, whether in human-readable source code form, machine-executable binary form, firmware, scripts, interpretive text, or otherwise, necessary or useful to design, develop or manufacture Reticles, including related documentation. "Software" does not include databases and other information stored in electronic form, other than executable instruction codes or source code that is intended to be compiled into executable instruction codes.

3

**** Material omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Exchange Act of 1934. Material filed separately with the Securities and Exchange Commission.

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     1.25 "Specifications" shall have the meaning given thereto in the Photronics to Micron Supply Agreement of even date herewith.

     1.26 "Standard Technology" shall mean [****]. A list of Standard Technology, if any, as of the Effective Date is set forth in Exhibit A hereto.

     1.27 "Technology" shall mean all documentation, works of authorship, know-how, data and data bases, formulae, algorithms, processes, inventions and discoveries (whether or not patentable), ideas, concepts, techniques, methods, content, technical information, engineering, production and other designs, drawings, schematics, tooling requirements, and other information, technology and materials, tangible or intangible, and necessary or useful to fulfill the Objectives or to design, develop or manufacture Reticles. "Technology" shall not include (i) Software, or (ii) customer data or information related to the design, development or manufacture of Reticles for either Micron or Photronics customers.

     1.28 "Technology Transfer Protocol" shall mean the preferred methodology and protocols for Micron to provide Technology implementation training to Photronics hereunder and for implementing that Technology at the Designated Facility. The initial Technology Transfer Protocol is attached hereto as Exhibit B, but may be modified from time to time by the Technology Steering Committee.

     1.29 "Unrestricted Reticles" shall mean Reticles designed for use in the manufacture of products other than Competing Products.

     1.30 "Unrestricted Technology" shall mean [****].

2. LICENSES

     2.1 License Grant by Micron to Company. Subject to the terms and conditions of this Agreement, Micron grants to the Company a royalty-free, non-exclusive, non-transferable license, without right of sublicense, under the Micron Intellectual Property Rights and to the Micron Technology (excluding Software), to develop, make, use, offer to sell and sell Reticles, and to create Improvements to the Micron Technology, solely in accordance with the Objectives.

     2.2 License Grant by Micron to Photronics. Subject to the terms and conditions of this Agreement, including the classification procedures, use restrictions, and conditions set forth in Section 3, Micron grants to Photronics and to each Photronics Controlled Subsidiary a non-exclusive, worldwide, non-transferable (except as provided in Section 9.4), fully paid-up (subject to Section 9.4) license, [****] under the Micron Intellectual Property Rights and to the Licensed Technology, to develop, use, make at Photronics Facilities, have Unrestricted Reticles made by the Company, import, offer to sell and sell Reticles, and to create Improvements to the Micron Technology.

4

**** Material omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Exchange Act of 1934. Material filed separately with the Securities and Exchange Commission.

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     2.3 License Grant by Photronics to the Company. Subject to the terms and conditions of this Agreement, Photronics grants to Company a royalty-free, non-exclusive, non-transferable, fully paid-up license, without right of sublicense, under the Photronics Intellectual Property Rights and to the Photronics Technology and Photronics Improvements, to develop, make, use, import, offer to sell and sell Reticles, and to create Improvements to the Micron Technology, solely in accordance with the Objectives.

     2.4 License Grant by Photronics to Micron. Subject to the terms and conditions of this Agreement, Photronics grants to Micron a royalty-free, non-exclusive, non-transferable, fully paid-up license, with right of sublicense only to Photronics Improvements, under the Photronics Intellectual Property Rights and to the Photronics Technology and Photronics Improvements, to develop, make, have made, use, import, offer to sell and sell Reticles, and to create Improvements to the Micron Technology.

     2.5 Software Licenses from Micron to the Company. Micron grants to the Company, subject to the terms and conditions of this Agreement, a royalty free, nonexclusive, limited license to reproduce, install and execute the Micron Software that Micron provides to the Company under Section 3 solely for the Company's internal use and only to fulfill the Objectives. The Company may make one copy of the Micron Software in machine-readable form for backup, disaster recovery or archival purposes only, and may make additional working copies beyond the copies provided by Micron as are reasonably necessary for the Company's internal use only. All such copies of Micron Software shall include all of the copyright and other proprietary notices of Micron contained on the original copy. The Company shall not assign, sublicense, transfer, pledge, lease, loan, rent to or share the Micron Software with any third party (except for Photronics personnel performing services for the Company at the Company's facilities). The Company shall not modify, decompile, reverse engineer, disassemble, or otherwise translate the Micron Software without the prior written consent of Micron in each case. Micron may from time to time provide the Company with human-readable source code for specified Micron Software. In such event, Micron will grant to the Company, subject to the terms and conditions of this Agreement, a royalty free, nonexclusive, limited license to reproduce, make derivative works of, install and execute such specified Micron Software.

     2.6 Software License from Micron to Photronics. Upon the Lease Commencement Date (as defined in the Build to Suit Lease between Micron and Photronics of even date herewith), [****] and for use only at the New Photronics Facility, Micron grants to Photronics, subject to the terms and conditions of this Agreement, a royalty free, non-exclusive, limited license to reproduce, install, and execute the Micron Software provided to Photronics pursuant to Section 3 below.

          (a) Photronics may make one copy of the Micron Software in machine-readable form for backup, disaster recovery or archival purposes only, and may make additional working copies beyond the copies provided by Micron as are reasonably necessary for Photronics' internal use only at the New Photronics Facility. All such copies of Micron Software shall include all of the copyright and other proprietary notices of Micron contained on the original copy. [****] Photronics shall not assign, sublicense, transfer, pledge, lease, loan, rent to or share the Micron Software with any third party, or use the Micron Software to perform services for any third party (excluding manufacture of Reticles by Photronics for third parties as expressly permitted under this Agreement). Photronics shall not modify, have modified, decompile, reverse engineer, disassemble, or otherwise translate the Micron Software without the prior written consent of Micron in each case.

5

**** Material omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Exchange Act of 1934. Material filed separately with the Securities and Exchange Commission.

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          (b) Micron may from time to time, upon the request of Photronics and in Micron's sole discretion, provide Photronics with human-readable source code for Micron Software. In such event, Micron will grant to Photronics, a nonexclusive, limited license to reproduce, make derivative works of, install and execute such Micron Software only at the New Photronics Facility and on the terms and conditions agreed to by the parties.

          (c) Photronics acknowledges that some of the Software [****] may be third party Software that Micron does not have the right to sublicense. Micron will identify applicable third party Software during the process of establishing the New Photronics Facility. Photronics shall be responsible at its own expense to independently license such third party Software. If such third party Software is not available to be licensed, Micron and Photronics shall consult in good faith about alternatives to such unavailable third party Software [****].

3. DELIVERABLES

     3.1 Initial Delivery to the Company. Micron will provide to the Company immediately after the Effective Date all Technology retained by Micron [****]. In addition, Micron will license and deliver to the Company the Software retained by Micron [****]. Photronics will provide to the Company promptly after the Effective Date the Approved Technology listed on Exhibit D hereto. The parties acknowledge that the ability to provide certain Technology and Software to the Company will be subject to the right to sublicense third party Technology and Software pursuant to existing license agreements. [****].

     3.2 Initial Delivery to Photronics. Within thirty (30) days following the Effective Date, Micron will deliver to Photronics or make available to Photronics the Licensed Technology retained by Micron [****]. In addition, Micron will provide Photronics certain Micron Software for implementation and use at the New Photronics Facility in accordance with the license grant set forth in Section 2.6 above. A list of such Micron Software will be determined by Micron prior to the Lease Commencement Date and will be provided to Photronics; the list will include the Micron Software reasonably necessary to assist Photronics [****]. The Licensed Technology and Micron Software will be made available for electronic transfer in accordance with means to be mutually agreed by Micron and Photronics, but where necessary, physical transfers may be conducted.

     3.3 Determination of Approved Technology. The Technology Steering Committee, pursuant to the Technology Steering Committee charter attached hereto as Exhibit E, will create general guidelines setting forth the process for determining whether Technology, regardless of source, will be Approved Technology for use by the Company and will make such determinations in accordance with the charter and the guidelines. The Technology Steering Committee may amend these guidelines from time to time. A negative determination will not preclude the Technology Steering Committee from later determining that Technology does constitute Approved Technology.

6

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     3.4 Determination of Licensed Technology and Availability of Licensed Technology; Additional Deliveries of Micron Software. Within thirty (30) days following the end of each calendar quarter, the Technology Steering Committee will convene to analyze any Technology developed during such calendar quarter at or by the Company. [****]. From time to time, Micron may provide Photronics additional Micron Software [****] in accordance with the license grant in Section 2.6. The quarterly Technology Steering Committee meetings may be used for purposes of discussing the provision of additional Micron Software to Photronics.

     3.5 Photronics Use Restrictions. [****].

          (a) [****].

          (b) [****].

          (c) [****].

     3.6 Photronics Improvements. Photronics will notify the Company and Micron no less frequently than once each calendar quarter of all Photronics Improvements recognized, logged, or recorded by Photronics pursuant to its standard internal processes for logging or tracking Improvements or inventions on its own behalf or for which Photronics seeks to claim, register, record, or file an application for recognition as an Intellectual Property Right of Photronics. Photronics promptly shall make available all such Photronics Improvements for use by the Company. As part of the quarterly meeting of the Technology Steering Committee pursuant to Section 3.4 above, the Technology Steering Committee will review any Photronics Improvements identified by Photronics as having been created the previous quarter and shall determine whether to treat the Photronics Improvements as Approved Technology. In addition, Micron shall have the opportunity to receive access to all Photronics Improvements, subject to the license grant set forth in Section 2.4.

     3.7 Initial Designated Facility. [****].

     3.8 New Facility. [****].

4. TRAINING AND SUPPORT.

     4.1 Initial Designated Facility Support. Micron agrees to provide Photronics technical support in connection with technology module transfers (as the term "module" is used in the Technology Transfer Protocol) [****]. Photronics may request that the designated Micron support personnel travel to the Designated Facility to provide technical support and Micron will approve such travel in its reasonable judgment, based on the availability of the appropriate Micron personnel and the nature of the request, provided that Photronics shall pay all travel expenses for any Micron approved travel. Micron shall have no obligation to provide support for implementation of Licensed Technology at Photronics facilities that are not the Designated Facility.

7

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     4.2 Support Related to New Photronics Facility. [****].

     4.3 On-site Training in Accordance with the Technology Transfer Protocol. In addition to the support specified in Sections 4.1, 4.2 and 4.5, Micron and Photronics anticipate that Micron will provide Photronics onsite training to be conducted at the Company to assist Photronics to learn and implement the Licensed Technology and Micron Software as authorized by this Agreement. The anticipated and preferred methodology for conducting this onsite training is set forth in the Technology Transfer Protocol, although this may be changed by the TSC. Both Micron and Photronics will make available the appropriate personnel to conduct and receive the onsite training in accordance with the guidelines and time periods set forth in the Technology Transfer Protocol.

     4.4 Additional Support. Photronics may request additional support from the General Manager and the General Manager may agree to provide such additional support in its sole discretion. Any such additional support hours shall be charged to Photronics at [****].

     4.5 Software Support. Photronics may request Software maintenance and support from Micron. During the term, this Software maintenance and support shall be charged to Photronics at [****]. During any wind-down period in which Software licenses survive the termination of this Agreement or the joint venture relationship contemplated by the Transaction Documents, Micron agrees to provide Photronics software maintenance and support services for a period of one (1) year for any Micron Software then installed at the New Photronics Facility at rates and upon terms consistent with Micron's then-standard software support rates and terms. All Micron Software support shall be subject to the terms and conditions set forth in Section (2) of Schedule 4.1(B) of the Information Technology, Operational and General Administrative Services Agreement of even date herewith. To the extent that there is any conflict between the terms and conditions of the foregoing referenced section and this Agreement, as to Software support that Micron provides to Photronics, the terms of this Agreement shall prevail. The New Photronics Facility may from time to time request that Micron make enhancements or improvements to the Micron Software or other Software installed at the New Photronics Facility. Any enhancements or improvements to the Micron Software or other Software installed at the New Photronics Facility are subject to the prior written approval of the Technology Steering Committee. Subject to the approval of the Technology Steering Committee, the same modifications may be made to the Micron Software and other Software installed at the Company.

5. PAYMENTS

     5.1 Initial Technology License Fee. On the Effective Date, Photronics will pay Micron Seventy-two Million Dollars ($72,000,000) for the initial provision of Licensed Technology and the licenses granted to Photronics under this Agreement to use such Licensed Technology. Such amount shall be non-refundable.

8

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     5.2 Costs. Unless otherwise set forth herein, each of Photronics and Micron shall bear its own costs and expenses regarding receipt and implementation of Technology licensed and made available to it under this Agreement. If Photronics requests that Micron provide any support on-site at a Photronics Facility, or otherwise requires a Micron employee to travel to provide technical support pursuant to Section 4 above, Photronics agrees to bear the reasonable travel and lodging expenses of the applicable Micron personnel in addition to any other fees that may apply.

     5.3 Taxes. To the extent that any taxes are applicable to the license and delivery of Licensed Technology and Micron Software to Photronics pursuant to this Agreement, Photronics shall be responsible for and shall pay any applicable sales, use, excise, withholding or similar taxes, including value added taxes and customs duties due on the importation of Licensed Technology and arising from the license to Photronics under this Agreement, excluding any taxes based on Micron's net income.

6. OWNERSHIP; INTELLECTUAL PROPERTY PROTECTION

     6.1 Ownership. Except as expressly set forth herein, this Agreement, the delivery of Technology and Software and the licenses granted hereunder shall not affect each of Photronics and Micron's ownership of its Technology and Software and the Intellectual Property Rights owned by such parties and licensed or provided to one or more parties under this Agreement. Micron shall own any and all derivative works, enhancements, improvements or modifications to Micron Software. All rights not expressly granted herein are reserved.

     6.2 Ownership of Company Improvements. Subject to the license grants set forth in Section 2, Micron shall own all Company Improvements. To the extent that Photronics or the Company obtains any ownership interest in or to such Company Improvements, Photronics and the Company hereby assign and agree to assign to Micron all of their right, title and interest in and to any Company Improvements. Notwithstanding the foregoing, the Technology Steering Committee may, in its discretion and upon Photronics' written request, determine that certain Technology that would otherwise be deemed a Company Improvement but that is primarily based on or derived from Photronics Technology, shall be deemed a Photronics Improvement and treated as such under Section 6.3 below.

     6.3 Ownership of Photronics Improvements. Subject to the license grants set forth in Section 2 and disclosure obligations set forth in Section 3.6, Photronics shall own all Photronics Improvements and any Intellectual Property Rights in or to such Photronics Improvements.

     6.4 Patent Prosecution. Micron shall have the right in its sole discretion to prepare, file, prosecute and maintain, at its own expense, any patent applications and Patents claiming Company Improvements, and to conduct any interferences, re-examinations, reissues, oppositions or requests for patent term extension or governmental equivalents thereto. Subject to Section 7, Photronics shall have the right in its sole discretion to prepare, file, prosecute and maintain, at its own expense, any patent applications and Patents claiming Photronics Improvements, and to conduct any interferences, re-examinations, reissues, oppositions or requests for patent term extension or governmental equivalents thereto.

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     6.5 Cooperation. The Company and Photronics shall each reasonably cooperate with and assist Micron at their own expense in connection with Micron's patent prosecution activities related to Company Improvements. The Technology Steering Committee will (a) facilitate communication among the parties regarding patent applications with respect to Company Improvements, (b) discuss and provide input to Micron on patent strategy with respect to Company Improvements, and (c) upon Micron's or Photronics request, review applications and other substantive papers with respect to Company Improvements prior to filing with the patent office.

     6.6 Enforcement.

          (a) Notice. Micron and Photronics shall each promptly notify Company of its knowledge of any actual or potential infringement of Intellectual Property Rights associated with the Approved Technology.

          (b) Cooperation; Costs. Each party agrees to render such reasonable assistance in connection with enforcement activities described in this Section 6.6 as the enforcing party may request. Costs of maintaining any such action shall be paid by and belong to the party bringing the action.

          (c) Recoveries. If any actions are undertaken for the benefit of the Company, any damages or settlement recovered from any such action (after the deduction of the costs and fees of the action) shall be allocated as follows: (i) to Micron if the action was undertaken by Micron; or (ii) to Micron and Photronics in proportion to their actual monetary contributions to the undertaking of the action if the action is undertaken for the benefit of the Company and agreed upon in advance by Micron and Photronics to be shared.

          (d) Third Party Claims of Infringement. If the manufacture, use or sale of any Reticles pursuant to this Agreement results in any claim, suit or proceeding alleging patent infringement against the Company, Micron or Photronics, the party named as the defendant in that claim, suit or proceeding shall promptly notify the other parties hereto in writing setting forth the facts of such claims in reasonable detail. The named defendant shall keep the other parties hereto reasonably informed of all material developments in connection with any such claim, suit or proceeding. The other parties shall, upon request, provide reasonable assistance and cooperation to the named defendant and may elect to participate in the defense of the claim, suit or proceeding, at its own expense using counsel of its own choice.

7. CONFIDENTIALITY

     All information provided, disclosed or obtained in connection with this Agreement or the performance of any of the Parties' activities under this Agreement shall be subject to the Confidentiality Agreement. Furthermore, the terms and conditions of this Agreement shall be considered "Confidential Information" under the Confidentiality Agreement for which each Party is considered a "Receiving Party" under such agreement. [****]. To the extent there is a conflict between this Agreement and the Confidentiality Agreement, the terms of this Agreement shall control. Furthermore, each party acknowledges and agrees that the authorized sale of a product under any of the Transaction Documents shall not constitute a breach of any confidentiality obligations under this Agreement or the Confidentiality Agreement to the extent that the authorized sale of a product inherently discloses Confidential Information of a Party. If the Confidentiality Agreement is terminated or expires and is not replaced, the Confidentiality Agreement shall continue with respect to confidential information provided in connection with this Agreement, notwithstanding such expiration or termination, for the duration of the initial term and any and all extension periods or until a new Confidentiality Agreement is entered into between the parties.

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8. LIMITED REPRESENTATIONS AND WARRANTIES

     8.1 Mutual Representations. Each party hereby represents and warrants to the other parties as follows:

         (a) The execution, delivery and performance of this Agreement by such party have been duly authorized by all necessary action on the part of such party.

         (b) This Agreement has been duly executed and delivered by such party and, assuming due authorization, execution and delivery by the other party, constitutes a legal, valid and binding obligation of such party, enforceable against such party in accordance with its terms.

         (c) To each party's knowledge, such party's execution, delivery and performance of this Agreement do not (i) violate, conflict with or result in the breach of any provision of the charter or by-laws (or similar organizational documents) of such party, or (ii) conflict with or violate any law or governmental order applicable to such party or any of its assets, properties or businesses.

     8.2 Limited Warranty. Micron and Photronics each represent and warrant that it has all necessary right, title or interest and has obtained all necessary consents to perform its obligations and to grant the licenses it grants under this Agreement, and that, to its knowledge, and without conducting specific investigation, the Technology or Software that it provides access to under this Agreement does not infringe upon or misappropriate the Intellectual Property Rights of any third party.

     8.3 Disclaimer. [****].

9. TERMINATION

     9.1 Term of Agreement. This Agreement shall become effective on the first day that it has been executed by both parties and shall remain in force for ten (10) years and will renew automatically for additional five (5) year terms, unless either Micron or Photronics terminates its participation in the Company or unless the Agreement is sooner terminated in accordance with Section 9.2 or Section 9.3 below.

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     9.2 Termination.

          (a) Micron and Photronics may terminate this Agreement upon mutual written consent.

          (b) Either Micron or Photronics may terminate this Agreement at any time in the event that the other materially breaches this Agreement and, if the material breach is capable of cure, such material breach continues uncured for a period of ninety (90) days after written notice thereof. Provided that if the breach is capable of being cured and the breaching Party has worked diligently and in good faith since the receipt of the notice to cure such breach, but has not cured the breach during the allotted time, the cure period will be extended for an additional ninety (90) days.

     9.3 Other Causes for Termination. Upon dissolution of the Company, or termination of the Operating Agreement, or a Permitted Photronics Change in Control (as defined in the Operating Agreement), this Agreement shall automatically terminate, and all rights to receive further disclosures of Technology and Software shall automatically terminate.

     9.4 Permitted Photronics Change in Control License Transfer Fee. [****].

     9.5 Survival. In the event of termination of this Agreement, the parties' rights and obligations under Sections 4.4, 6, 7, 8, 9.4, 9.5, 10 and 11 shall survive and continue in effect. In addition, and notwithstanding anything to the contrary contained herein, except for a termination of the Agreement under Section 9.2(b), the licenses granted under Section 2 shall survive the termination or expiration of this Agreement, provided that [****].

10. LIMITATION OF LIABILITY

[****] Each party acknowledges that the foregoing limitations are an essential element of the Agreement between the parties and that in the absence of such limitations the pricing and other terms set forth in this Agreement would be substantially different. Each Party shall have a duty to mitigate any damages hereunder in accordance with applicable law.

11. MISCELLANEOUS

     11.1 Amendments. This Agreement may not be amended without the prior written consent of each party hereto.

     11.2 No Waiver. Any provision of this Agreement may be waived if, and only if, such waiver is in writing and is duly executed by the party against whom the waiver is to be enforced. No failure or delay by any party in exercising any right, power or privilege under this Agreement shall operate as a waiver thereof nor shall any single or partial waiver or exercise thereof preclude the enforcement of any other right, power or privilege.

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     11.3 Notices. Unless otherwise provided herein, all notices, requests, instructions or consents required or permitted under this Agreement shall be in writing and will be deemed given: (a) when delivered personally; (b) when sent by confirmed facsimile; (c) ten (10) Business Days after having been sent by registered or certified mail, return receipt requested, postage prepaid; or (d) three (3) Business Days after deposit with an internationally recognized commercial overnight carrier specifying next-day delivery, with written verification of receipt. All communications will be sent to the addresses listed on Exhibit A of the Operating Agreement (or to such other address or facsimile number as may be designated by a party giving written notice to the other parties pursuant to this Section 11.3).

     11.4 Independent Development. Subject to the license restrictions and confidentiality obligations set forth in this Agreement, nothing in this Agreement shall be construed to preclude either Micron or Photronics from directly or indirectly designing, developing, acquiring, using, marketing, licensing or selling any technology, prototypes, or production Reticles that is similar, related to or competitive with those developed, designed or manufactured by the other party or by the Company.

     11.5 Governing Law. This Agreement will be governed by and construed in accordance with the laws of the State of Delaware, United States of America, as applied to agreements among Delaware residents entered into and wholly to be performed within the State of Delaware (without reference to any choice or conflicts of laws rules or principles that would require the application of the laws of any other jurisdiction).

     11.6 Construction; Interpretation.

          (a) Certain Terms. The words "hereof," "herein," "hereunder" and similar words refer to this Agreement as a whole and not to any particular provision of this Agreement. The term "including" is not limited and means "including without limitation."

          (b) Section References; Titles and Subtitles. Unless otherwise noted, all references to Sections and Exhibits herein are to Sections and Exhibits of this Agreement. The titles, captions and headings of this Agreement are inserted for convenience of reference only and are not intended to be a part of or to affect the meaning or interpretation of this Agreement.

          (c) Reference to Persons, Agreements, Statutes. Unless otherwise expressly provided herein, (i) references to a Person include its successors and permitted assigns, (ii) references to agreements (including this Agreement) and other contractual instruments shall be deemed to include all subsequent amendments, restatements and other modifications thereto or supplements thereof and (iii) references to any statute or regulation are to be construed as including all statutory and regulatory provisions consolidating, amending, replacing, supplementing or interpreting such statute or regulation.

          (d) Presumptions. No party, nor its counsel, shall be deemed the drafter of this Agreement for purposes of construing the provisions of this Agreement, and all provisions of this Agreement shall be construed in accordance with their fair meaning, and not strictly for or against any party.

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     11.7 Rights and Remedies Cumulative. The rights and remedies provided by this Agreement are cumulative and the use of any one right or remedy by any party shall not preclude or waive its right to use any or all other remedies. Said rights and remedies are given in addition to any other rights the parties may have by law, statute, ordinance or otherwise.

     11.8 No Assignment; Binding Effect. Except as otherwise expressly provided in Section 9.4, no party may assign, delegate or otherwise transfer any of its rights or obligations hereunder to any third party, whether by assignment, transfer, Change in Control, or other means, without the prior written consent of each other party. Any attempted assignment in violation of the foregoing shall be null and void. Subject to the foregoing, this Agreement shall be binding on and inure to the benefit of the parties, their heirs, executors, administrators, and successors.

     11.9 Severability. If any provision in this Agreement will be found or be held to be invalid or unenforceable, then the meaning of said provision will be construed, to the extent feasible, so as to render the provision enforceable, and if no feasible interpretation would save such provision, it will be severed from the remainder of this Agreement which will remain in full force and effect unless the severed provision is essential and material to the rights or benefits received by any party. In such event, the parties will use their respective best efforts to negotiate, in good faith, a substitute, valid and enforceable provision or agreement which most nearly affects the parties' intent in entering into this Agreement.

     11.10 Counterparts. This Agreement may be executed in counterparts, each of which so executed will be deemed to be an original and such counterparts together will constitute one and the same agreement. Execution and delivery of this Agreement by exchange of facsimile copies bearing the facsimile signature of a party shall constitute a valid and binding execution and delivery of this Agreement by such party.

     11.11 Dispute Resolution. The parties hereby agree that claims, disputes or controversies of whatever nature, arising out of, in connection with, or in relation to the interpretation, performance or breach of this Agreement (or any other agreement contemplated by or related to this Agreement), shall be resolved in accordance with the dispute resolution procedures set forth in the Operating Agreement.

     11.12 Third-Party Beneficiaries. None of the provisions of this Agreement shall be for the benefit of or be enforceable by any creditor of the Company or by any third-party creditor of any Member. This Agreement is not intended to confer any rights or remedies hereunder upon, and shall not be enforceable by, any Person other than the parties hereto, their respective successors and permitted assigns.

     11.13 Entire Agreement. This Agreement, together with the other documents, exhibits and schedules referred to herein and therein, constitute the entire agreement among the parties hereto pertaining to the subject matter hereof, and supersede any and all prior oral and written, and all contemporaneous oral, agreements or understandings pertaining thereto. There are no agreements, understandings, restrictions, warranties or representations relating to such subject matter among the parties other than those set forth herein and in the other documents, exhibits and schedules referred to herein and therein.

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     IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the day and year first above written.

EXHIBITS:
Exhibit A:		Approved Technology and Licensed Technology
Exhibit B:		Technology Transfer Protocol
Exhibit C:		Software
Exhibit D:		Approved Technology of Photronics
Exhibit E:		Technology Steering Committee Charter

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Exhibit A

Approved Technology and Licensed Technology

     [****]

**** Material omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Exchange Act of 1934. Material filed separately with the Securities and Exchange Commission.

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Attachment 1 to Exhibit A

Initial Approved Technology List

[****]

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Exhibit B

Technology Transfer Protocol

     [****]

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Exhibit C

Software

[****]

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Exhibit D

Approved Technology of Photronics

[****]

**** Material omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Exchange Act of 1934. Material filed separately with the Securities and Exchange Commission.

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Exhibit E

Technology Steering Committee Charter

[****]

**** Material omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Exchange Act of 1934. Material filed separately with the Securities and Exchange Commission.

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Exhibit 10.17

PHOTRONICS TO MICRON SUPPLY AGREEMENT

     THIS PHOTRONICS TO MICRON SUPPLY AGREEMENT (together with the Schedules attached hereto, collectively this "Agreement") is made and entered into as of May 5, 2006 (the "Effective Date"), by and between MICRON TECHNOLOGY, INC., a Delaware corporation and its Affiliates (collectively "Micron"), and PHOTRONICS, INC., a Connecticut corporation ("Photronics"). Micron and Photronics are hereinafter collectively referred to as the "Parties" and individually as a "Party."

RECITALS

     WHEREAS, pursuant to the Limited Liability Company Operating Agreement of MP Mask Technology Center, LLC, of the same Effective Date herewith, by and between Micron and Photronics (the "Operating Agreement"), the Parties have formed MP Mask Technology Center, LLC (the "Company") for the purpose of developing, producing and manufacturing photomasks and prototypes for photomasks;

     WHEREAS, the Parties have entered into a Technology License Agreement of the same Effective Date herewith, under which the necessary technology has been licensed to the Company and Photronics (as defined below) in order for such Parties to fulfill their obligations under this Agreement;

     WHEREAS, the Company and Photronics have entered into a separate supply agreement of even Effective Date herewith, which details the terms under which Photronics will purchase Products manufactured by the Company; and

     WHEREAS, the Parties desire to enter into this Agreement to establish the terms under which Micron shall purchase Products from Photronics;

     NOW, THEREFORE, in consideration of the mutual representations, warranties, covenants and other terms and conditions contained herein, the Parties hereby agree as follows:

1. DEFINITIONS; INTERPRETATION

     For purposes of this Agreement, the definitions set forth in this Section 1 shall apply to the respective capitalized terms. All capitalized terms not defined herein shall have the meaning set forth in the Operating Agreement.

     1.1 "Capacity" shall have the meaning set forth in Section 2.7.

     1.2 "Capacity Commitment" shall have the meaning set forth in Section 2.7.

     1.3 "Copy Critical" shall have the meaning set forth in the Technology License Agreement.

     1.4 "Copy Exact" shall have the meaning set forth in the Technology License Agreement.

     1.5 "Copy Exact Photronics Facility" shall have the meaning for a Photronics Facility that is Copy Exact, each as defined in the Technology License Agreement.

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     1.6 "Cost" shall have the meaning set forth in Schedule 5.1.

     1.7 "Dead-on-Arrival" shall mean any Product that is discovered to contain a Material Defect within thirty (30) calendar days after receipt of shipment of the Product.

     1.8 "Entity" means a corporation, partnership, limited liability company, unincorporated organization, business association, firm, joint venture or other legal entity.

     1.9 "Fiscal Month" shall mean a fiscal month of Micron.

     1.10 "Fiscal Quarter" shall mean a fiscal quarter of Micron.

     1.11 "Fiscal Year" shall mean a fiscal year of Micron.

     1.12 "Forecast" shall have the meaning set forth in Section 2.5.

     1.13 "Intellectual Property Right" shall have the meaning set forth in the Technology License Agreement.

     1.14 "Licensed Technology" shall have the meaning set forth in the Technology License Agreement.

     1.15 "Loading Failure Margin" shall have the meaning set forth in Section 2.4.

     1.16 "Loading Percentage" shall mean [****].

     1.17 "Loading Requirement" shall mean [****].

     1.18 "Material Defect" shall mean any malfunction, error or other defect in a Product that constitutes a material nonconformity with the Specifications for such Product under conditions of normal and proper use.

     1.19 "Maximum Capacity Commitment" shall have the meaning set forth in Section 2.7.

     1.20 "Micron Supply Agreement" shall mean the Micron Direct Supply Agreement of the same Effective Date herewith, by and between Micron and the Company.

     1.21 "New Photronics Facility" shall have the meaning set forth in the Technology License Agreement.

     1.22 "New Photronics Facility Lease" shall mean the Build to Suit Lease of the same Effective Date herewith by and between Micron and Photronics relating to the New Photronics Facility.

     1.23 "Next Quarter Forecast" shall have the meaning set forth in Section 2.5.

     1.24 "Photronics Facility" shall mean (i) a facility that directly, or indirectly through one or more intermediaries, is at least ninety percent (90%) owned by Photronics unless otherwise agreed upon by Micron in writing on a case-by-case basis or (ii) [Photronics Semiconductor Mask Corporation (Taiwan) ("PSMC"), provided that Photronics' direct or indirect ownership of PSMC at all times is greater than 50% and no company that makes or sells Competing Products owns any ownership interest in PSMC.

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     1.25 "Photronics Supply Agreement" shall mean the Supply Agreement of the same effective date herewith, by and among Photronics and the Company.

     1.26 "Product" or "Products" means photomasks and photomask prototypes that are to be manufactured by the Company or Photronics in accordance with Micron's Specifications and requirements.

     1.27 "Process Node" shall have the meaning set forth in the Technology License Agreement.

     1.28 "Purchase Order" shall mean a written purchase order or blanket purchase order that is delivered to Photronics in accordance with Section 3.2.

     1.29 "Qualified" shall have the meaning set forth in the Technology License Agreement.

     1.30 "Qualified Product(s)" shall have the meaning set forth in Section 2.7.

     1.31 "Specifications" shall mean the specifications provided by Micron to Photronics for each Product in accordance with Micron's photomask ordering procedures and node requirements.

     1.32 "Technology License Agreement" shall mean the Technology License Agreement of the same effective date herewith, by and among Micron, Photronics and the Company.

     1.33 "Warranty Period" shall have the meaning set forth in Section 6.1.

2. PURCHASES; MANUFACTURE AND SUPPLY; PRODUCT TRANSITION; FORECASTS

     2.1 Micron Purchases. Micron shall purchase Products from Photronics in accordance with the terms and conditions of this Agreement. [****].

     2.2 Photronics Manufacture and Supply of Product. Photronics shall accept Purchase Orders from Micron for Product and shall either manufacture Product at a Micron Qualified Photronics Facility or subcontract the manufacture of such Product to the Company pursuant to the terms of the Photronics Supply Agreement. [****].

     2.3 Photronics Manufacturing Approach. [****].

     2.4 Loading Requirement. Photronics shall maintain the Loading Requirement at all times during the Term, as measured on the basis of orders or releases thereto, as applicable, placed each Fiscal Month, so as to ensure the most efficient and cost effective utilization of the Company.

     2.5 Forecasts. [****].

     2.6 Micron Purchase Commitment. [****].

     2.7 [****].

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3. PURCHASE ORDERS

     3.1 Purchase Orders. Micron shall purchase Products from Photronics by issuing a Purchase Order or a release to a blanket Purchase Order that references this Agreement. Micron and Photronics agree that a Purchase Order sent to Photronics by confirmed facsimile or electronic transmission shall constitute a writing for all legal purposes. All Purchase Orders submitted to Photronics shall be governed by the terms of this Agreement. Nothing contained in any Purchase Order or the Parties' other documents of purchase or sale shall in any way modify the terms of purchase or add any additional terms or conditions except as specifically agreed in writing by the Parties.

     3.2 Acknowledgment of Purchase Orders. For Micron's orders from Photronics Facilities, Photronics shall notify Micron of the receipt and acceptance of a Purchase Order or releases thereto and of the accepted delivery date for accepted orders within two (2) business days after receipt of the Purchase Order and any Purchase Order not specifically rejected in writing by Photronics during such period shall be deemed accepted hereunder. Photronics may not reject a Purchase Order or release issued in compliance with this Agreement and seeking delivery of Products within established lead times and the Forecasted amounts (subject to the Maximum Capacity Commitment, if applicable).

     3.3 Revision of Purchase Orders. Micron shall have the right, without charge, to issue change orders to Purchase Orders by providing written notice to Photronics prior to the beginning of the production of the Product impacted by such change order. Photronics shall use all commercially reasonable efforts to accommodate Micron's revised Purchase Order in accordance with the lead times in effect at the time the Purchase Order change is requested.

     3.4 Cancellations. Micron may cancel all or any part of a Purchase Order, without charge, by providing written notice to Photronics prior to the beginning of the production of the Product impacted by such cancellation. [****].

     3.5 Reschedules. Micron may reschedule the delivery of any Purchase Order or portion thereof for Products, without charge, upon notice to Photronics.

4. SHIPPING; DELIVERY; ACCEPTANCE

     4.1 Packaging Requirements. All shipments shall be in packaging that complies with Micron's packaging requirements provided to Photronics and the Specifications. In addition, all shipments shall be accompanied by a detailed packing list which will reference the Products, Purchase Order number, and the quantity in each shipment covered by the packing list.

     4.2 Shipping. Photronics shall ensure that Product orders are delivered on the applicable delivery date(s). Orders will be shipped to the delivery address set forth in the applicable Purchase Order.

     4.3 Delivery. Photronics' liability for delivery shall cease and title and all risk of loss or damage shall transfer to Micron when Product is delivered to Micron's designated receiving facility as specified in the Purchase Order. Micron shall be the importer of record and pay all related duties, fees and charges. Photronics shall immediately notify Micron in writing of any anticipated delay in meeting the delivery schedule, stating the reasons for the delay. No shipment will be deemed complete until all ordered units have been delivered.

     4.4 Dead on Arrival. In the event that any Product is found by Micron to be Dead-on-Arrival, Photronics shall use reasonable efforts consistent with the Company's practices to ship, at Photronics' sole expense, a replacement Product to the site designated by Micron within fourteen (14) business days of receipt of notice from Micron, and Micron shall return the Dead-on-Arrival Product in accordance with the Product return procedures described under Section 6.2.

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5. PRICE; PAYMENTS; TAXES; AUDIT

     5.1 Purchase Price for Products. The purchase price for each Product purchased by Micron from Photronics shall be as set forth in Schedule 5.1.

     5.2 Payments Terms. Photronics shall issue and deliver an invoice to Micron for any amounts payable to Photronics pursuant to this Agreement. [****]. Unless otherwise agreed by the Parties, payments for Products delivered in accordance with Section 4, and any other payments required hereunder, shall be made within thirty (30) days after the receipt of final invoice. Payment does not constitute acceptance. In no event shall Photronics deliver an invoice before shipping the Products to which such invoice relates. Photronics may suspend performance hereunder if Micron fails to make any material overdue and undisputed payments hereunder within thirty (30) days after receipt of written notice from Photronics that such payment is overdue.

     5.3 Taxes. All amounts payable for Product sold by Photronics to Micron hereunder are exclusive of any taxes. Micron shall be responsible for and shall pay any applicable sales, use, excise or similar taxes, including value added taxes and customs duties due on the importation of Products and arising from purchases made by Micron under this Agreement, excluding any taxes based on Photronics' income. All such taxes shall be determined based upon the final shipment designation of the items identified on the invoice.

     5.4 Audit of Books and Records. Upon Micron's request from time to time (not to exceed two (2) times per year), Micron shall, upon reasonable advance notice to Photronics, have the right to have an independent auditor reasonably acceptable to Photronics perform an audit of Photronics' books and records to verify Photronics' compliance with the terms and conditions of this Agreement, [****]. In the event an audit reveals an overpayment by Micron, Photronics shall immediately issue a refund to Micron for any such overpayment. Any audit performed hereunder shall be performed in a manner that does not unreasonably interfere with Photronics' business and ensures compliance with all Applicable Laws and confidentiality requirements.

     5.5 Inspection and Audit of Photronics Facilities. Upon Micron's reasonable advance request from time to time, Micron shall have the right to perform a reasonable inspection and audit of Photronics' facilities used to manufacture Product hereunder, as necessary to verify that the manufacturing facilities are Qualified in respect of any part type family or Process Node. In the event an inspection of a Photronics' Facility reveals any deficiency in meeting Micron's Specifications and requirements or any other failure to be Qualified, Photronics shall promptly take action to remedy such deficiency.

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6. WARRANTIES

     6.1 Product Warranty. [****]. This warranty does not apply to any Product failures resulting from any misuse, abuse, neglect, alteration, modification, improper installation of or repairs to the Product by anyone other than Photronics or the Company.

     6.2 Remedies. In the event that Micron notifies Photronics during the applicable Warranty Period that any Product does not conform to the warranty provisions set forth in Section 6.1, Photronics shall, at Micron's option, (a) replace such defective Product at no cost to Micron in accordance with Photronics' Product return material authorization procedures within ten (10) days of Photronics' receipt of the defective Product, (b) repair such defective Product at no cost to Micron, or (c) provide a refund of any amounts paid by Micron for such defective Product. Photronics shall bear all packing, transportation, insurance and other costs incurred in connection with the replacement or repair of defective Products. Except for resulting personal injury or property damage, this paragraph states the exclusive remedy of Micron for failure of any Product to conform to the warranty provisions set forth in Section 6.1.

     6.3 Disclaimer. EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT, NEITHER PARTY MAKES (AND EACH PARTY HEREBY EXPRESSLY DISCLAIMS) ANY REPRESENTATIONS OR WARRANTIES, WHETHER EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE OR NON-INFRINGEMENT, AND ANY WARRANTIES THAT MAY ARISE FROM COURSE OF PERFORMANCE, COURSE OF DEALING OR USAGE OF TRADE.

7. CONFIDENTIAL INFORMATION

     7.1 Protection and Use of Confidential Information. All information provided, disclosed or obtained in connection with this Agreement or the performance of either of the Parties' activities under this Agreement shall be subject to all applicable provisions of the Nondisclosure Agreement. Furthermore, the terms and conditions of this Agreement shall be considered "Confidential Information" under the Nondisclosure Agreement for which each Party is considered a "Receiving Party" under such agreement. To the extent there is a conflict between this Agreement and the Nondisclosure Agreement, the terms of this Agreement shall control. If the Nondisclosure Agreement is terminated or expires and is not replaced, such Nondisclosure Agreement shall continue with respect to confidential information provided in connection with this Agreement, notwithstanding such expiration or termination, for the duration of the Initial Term and any and all extension periods or until a new nondisclosure agreement is entered into between the Parties.

8. LIMITATION OF LIABILITY

[****], IN NO EVENT WILL EITHER PARTY BE LIABLE TO THE OTHER PARTY OR ANY THIRD PARTY CLAIMING THROUGH OR UNDER EACH SUCH PARTY, FOR ANY LOST PROFITS, LOST DATA, EQUIPMENT DOWNTIME, OR FOR ANY INDIRECT, INCIDENTAL, SPECIAL OR CONSEQUENTIAL DAMAGES, WHETHER IN AN ACTION IN CONTRACT OR TORT, BASED ON A WARRANTY, SALE OF PRODUCT OR OTHERWISE, ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT, EVEN IF EACH SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. [****]. Each Party acknowledges that the foregoing limitations are an essential element of the Agreement between the Parties and that in the absence of such limitations the pricing and other terms set forth in this Agreement would be substantially different. Except for Product to be supplied pursuant to Section 9.4.3, in no other event shall Photronics be liable for "cover" damages claimed by Micron arising out of any failure by Photronics to supply Products hereunder after expiration or termination of this Agreement. Each Party shall have a duty to mitigate any damages hereunder in accordance with applicable law.

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9. TERM AND TERMINATION

     9.1 Term. This Agreement will be effective as of the Effective Date, and shall remain in force for ten (10) years (the "Initial Term"). The expiration of this Agreement after its initial term or any renewal terms shall not be a termination for purposes of Section 9.4.3 below.

     9.2 Termination for Breach. Either Micron or Photronics may terminate this Agreement at any time in the event that the other Party materially breaches any of the provisions of this Agreement or the Photronics Supply Agreement and does not cure such material breach within ninety (90) days following receipt of notice of such breach. Provided that if the breach is capable of being cured and the breaching Party has worked diligently and in good faith since the receipt of the notice to cure such breach, the cure period will be extended for an additional thirty (30) days.

     9.3 Cross-Termination. Unless otherwise expressly agreed in writing by the Parties, this Agreement shall automatically terminate upon the dissolution of the Company or the termination of the Operating Agreement, Micron's purchase of Photronics' Membership Interests or termination of the Photronics Supply Agreement.

     9.4 Effect of Termination.

          9.4.1 Continuing Liability. The termination of this Agreement for any reason shall not release either Party from any liability, obligation or agreement which has already accrued at the time of termination. Termination of this Agreement for any reason shall not constitute a waiver or release of, or otherwise be deemed to prejudice or adversely affect, any rights, remedies or claims, whether for damages or otherwise, which a Party may have hereunder, at law or otherwise, or which may arise out of or in connection with such termination.

          9.4.2 Outstanding Purchase Order Fulfillment. Except as provided in Section 9.4.3 below, Photronics shall complete all Purchase Orders that have been previously accepted by Photronics and not specifically cancelled upon termination by Micron, and shall accept and fulfill any Purchase Orders issued by Micron for a period of [****] after termination of this Agreement, provided that the reason for termination was not a failure by Micron to pay undisputed amounts to Photronics under this Agreement.

          9.4.3 [****].

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          9.4.4 Payment Obligation. Micron shall pay for all Products previously delivered by Photronics and all Products subsequently delivered by Photronics pursuant to the Purchase Orders referred to in Section 9.4.2.

     9.5 Survival. The provisions of Sections 2.7 (to the extent implicated by Section 9.4.3), 5.3, 6, 7, 8, 9.4, 9.5, 10 and 11 shall survive any termination of this Agreement.

10. INTELLECTUAL PROPERTY INFRINGEMENT INDEMNIFICATION

     10.1 Micron Indemnity. Micron shall defend Photronics at Micron's expense, subject to the limits contained herein, against any third party suits, actions, claims or proceedings alleging that photomasks manufactured by Photronics strictly in accordance with Micron Specifications at Copy Exact Photronics Facilities or the Company facility for sale to Micron hereunder infringe such third party's patent rights, copyrights or trademarks, or misappropriate such third party's trade secrets, and Micron agrees to indemnify Photronics and hold Photronics harmless from and against any damages, losses, costs and expenses (including reasonable attorneys' fees) awarded by a court or in settlement against Photronics in connection with any such third party claim, [****]; provided that (i) Photronics notifies Micron promptly in writing of the claim; (ii) Micron has sole control of the defense and all related settlement negotiations; and (iii) Photronics provides Micron (at Micron's request and reasonable expense) with all necessary assistance, information, and authority to perform these duties.

     10.2 Exclusions. Notwithstanding the foregoing, Micron shall not indemnify Photronics against claims, and shall have no liability for any claims of infringement based on or arising from (i) use of any superseded Licensed Technology where Micron has made available specific replacements for such Licensed Technology, to the extent the infringement would have been avoided by use of the replacement Licensed Technology; (ii) modification of the Licensed Technology by Photronics or any third party to the extent such infringement would have been avoided but for such modification; (iii) the combination or use of the Licensed Technology with materials or technology not furnished by Micron, to the extent such infringement would have been avoided but for such combination; or (iv) any claims that the customer products produced as a result of using the photomasks specified and purchased by Micron infringe or misappropriate the Intellectual Property Rights of any third party.

     10.3 Photronics Indemnity. Photronics shall defend Micron at Photronics' expense, subject to the limits contained herein, against any third party suits, actions, claims or proceedings alleging that any photomasks manufactured by Photronics at Photronics facilities or the Company facility, infringe such third party's patent rights, copyrights or trademarks, or misappropriate such third party's trade secrets, and Photronics agrees to indemnify Micron and hold Micron harmless from and against any damages, losses, costs and expenses (including reasonable attorneys' fees) awarded by a court or in settlement against Micron in connection with any such third party claim [****]; provided that (i) Micron notifies Photronics promptly in writing of the claim; (ii) Photronics has sole control of the defense and all related settlement negotiations; and (iii) Micron provides Photronics (at Photronics' request and reasonable expense) with all necessary assistance, information, and authority to perform these duties.

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     10.4 Exclusions. Notwithstanding the foregoing, Photronics shall not indemnify Micron against claims, and shall have no liability for any claims, of infringement with respect to which Photronics is indemnified by Micron under Section 10.1 above, or based on or arising from any claims that the customer products produced as a result of using the photomasks specified and purchased by Micron infringe or misappropriate the Intellectual Property Rights of any third party.

11. MISCELLANEOUS TERMS

     11.1 Amendments. This Agreement may not be amended without the prior written consent of both Parties.

     11.2 No Waiver. Any provision of this Agreement may be waived if, and only if, such waiver is in writing and is duly executed by the Party against whom the waiver is to be enforced. No failure or delay by any Party in exercising any right, power or privilege under this Agreement shall operate as a waiver thereof nor shall any single or partial waiver or exercise thereof preclude the enforcement of any other right, power or privilege.

     11.3 Notices and Other Communications. All notices required or permitted under this Agreement shall reference this Agreement and will be deemed given: (a) when sent by confirmed facsimile; (b) five (5) business days after having been sent by registered or certified mail, return receipt requested, postage prepaid; or (c) three (3) business days after deposit with an internationally recognized commercial overnight carrier specifying next-day delivery, with written verification of receipt. All such notices, requests, demands and other communications shall be addressed as follows:

If to Photronics:

Photronics, Inc.
15 Secor Road
Brookfield, CT 06804
Attention: Edwin L. Lewis, Senior Vice President and General Counsel
Facsimile: (203) 775-5601

and

Photronics, Inc.
15 Secor Road Brookfield, CT 06804
Attention: Sean Smith, Senior Vice President and Chief Financial Officer
Facsimile: (203) 775-5601

If to Micron:

Micron Technology, Inc.
8000 S. Federal Way
Boise, Idaho 83716
Attention: General Counsel
Facsimile: (208) 368-4540

or to such other address or facsimile number as a Party may have specified to the other Parties in writing delivered in accordance with this Section.

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     11.4 Governing Law. This Agreement will be governed by and construed in accordance with the laws of the State of Delaware, United States of America, as applied to agreements among Delaware residents entered into and wholly to be performed within the State of Delaware (without reference to any choice or conflicts of laws rules or principles that would require the application of the laws of any other jurisdiction).

     11.5 Construction; Interpretation.

          11.5.1 Certain Terms. The words "hereof," "herein," "hereunder" and similar words refer to this Agreement as a whole and not to any particular provision of this Agreement. The term "including" is not limited and means "including without limitation."

          11.5.2 Section References; Titles and Subtitles. Unless otherwise noted, all references to Sections and Schedules herein are to Sections and Schedules of this Agreement. The titles, captions and headings of this Agreement are inserted for convenience of reference only and are not intended to be a part of or to affect the meaning or interpretation of this Agreement.

          11.5.3 Reference to Persons, Agreements, Statutes. Unless otherwise expressly provided herein, (i) references to a Person include its successors and permitted assigns, (ii) references to agreements (including this Agreement) and other contractual instruments shall be deemed to include all subsequent amendments, restatements and other modifications thereto or supplements thereof and (iii) references to any statute or regulation are to be construed as including all statutory and regulatory provisions consolidating, amending, replacing, supplementing or interpreting such statute or regulation.

          11.5.4 Presumptions. No party, nor its counsel, shall be deemed the drafter of this Agreement for purposes of construing the provisions of this Agreement, and all provisions of this Agreement shall be construed in accordance with their fair meaning, and not strictly for or against any party.

     11.6 Rights and Remedies Cumulative. Except as provided in Section 6.2 and subject to the limitations of liability provided in Section 8, above, all remedies provided for in this Agreement shall be cumulative and in addition to and not in lieu of any other remedies available to any Party at law, in equity or otherwise.

     11.7 No Assignment; Binding Effect. Except as otherwise expressly provided in this Agreement, neither Party may assign, delegate or otherwise transfer any of its rights or obligations hereunder to any third party, whether by assignment, transfer, Change in Control, or other means, without the prior written consent of the other Party; provided, however, that this Agreement may be assigned in connection with a Permitted Photronics Change of Control if Micron does not elect to exercise its purchase rights pursuant to Section 7.4.2 of the Operating Agreement. Any attempted assignment in violation of the foregoing shall be null and void. Subject to the foregoing, this Agreement shall be binding on and inure to the benefit of the Parties, their heirs, executors, administrators, and successors.

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     11.8 Relationship of the Parties; Non-exclusivity. In the exercise of their respective rights and the performance of their respective obligations hereunder the Parties are, and will remain independent contractors. Nothing in this Agreement will be construed to constitute the Parties as partners or principal and agent for any purpose whatsoever. Neither Party will bind, or attempt to bind, the other Party hereto to any contract or other obligation, and neither Party will represent to any third party that it is authorized to act on behalf of the other Party to this Agreement. Subject to Section 2.6, nothing in this Agreement shall obligate Micron to purchase Products exclusively from Photronics or the Company, and Micron may at any time purchase Products from other third party manufacturers. In addition and notwithstanding anything in this Agreement, Micron may make direct purchases from the Company in accordance with the terms and conditions of the Micron Supply Agreement.

     11.9 Severability. If any provision in this Agreement will be found or be held to be invalid or unenforceable, then the meaning of said provision will be construed, to the extent feasible, so as to render the provision enforceable, and if no feasible interpretation would save such provision, it will be severed from the remainder of this Agreement which will remain in full force and effect unless the severed provision is essential and material to the rights or benefits received by any Party. In such event, the Parties will use their respective best efforts to negotiate, in good faith, a substitute, valid and enforceable provision or agreement which most nearly effects the Parties' intent in entering into this Agreement.

     11.10 Execution. This Agreement may be executed in counterparts, each of which so executed will be deemed to be an original and such counterparts together will constitute one and the same agreement. Execution and delivery of this Agreement by exchange of facsimile copies bearing the facsimile signature of a Party shall constitute a valid and binding execution and delivery of this Agreement by such Party.

     11.11 Dispute Resolution. The Parties hereby agree that claims, disputes or controversies of whatever nature, arising out of, in connection with, or in relation to the interpretation, performance or breach of this Agreement (or any other agreement contemplated by or related to this Agreement), shall be resolved in accordance with the dispute resolution procedures set forth in Section 11.3 of the Operating Agreement.

     11.12 Entire Agreement. This Agreement, together with the other documents, exhibits and schedules referred to herein and therein, constitute the entire agreement among the Parties hereto pertaining to the subject matter hereof, and supersede any and all prior oral and written, and all contemporaneous oral, agreements or understandings pertaining thereto. There are no agreements, understandings, restrictions, warranties or representations relating to such subject matter between the Parties other than those set forth herein and in the other documents, exhibits and schedules referred to herein and therein.

     11.13 No Third Party Beneficiaries. The terms and provisions of this Agreement are intended solely for the benefit of the Parties and their respective successors and permitted assigns, and the Parties do not intend to confer third party beneficiary rights upon any other Entity or person.

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     11.14 Force Majeure. Neither Party shall be deemed in default if its performance or obligations hereunder are delayed or become impossible or impractical due to causes beyond its reasonable control, including acts of God, war, fire, earthquake, flood, riot and acts of civil or military authority. Force majeure events shall not include delays in transportation, shortages of material or delays by subcontractors or suppliers, unless such delay by a subcontractor or a supplier was caused by an event that would qualify as a force majeure event under this Section 11.14. Under no circumstances shall economic considerations or economic impossibilities or inefficiencies delay performance or be considered a force majeure. The time for performance of any such obligation shall be extended for the time period lost by reason of the delay. During any period in which Photronics is unable to fulfill Micron purchase orders due to a force majeure event and for ninety (90) days after the effect of the force majeure event ends, Micron shall be relieved of its purchase commitment pursuant to Section 2.6.

[Signature Page Follows]

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     IN WITNESS WHEREOF, the Parties hereto have duly executed this Agreement as of the day and year first above written.

	Photronics, Inc.
	By:
	Name:
	Title:
	Micron Technology, Inc.
	By:
	Name:
	Title:

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SCHEDULE 5.1

PRICING

     [****]

S-1

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Exhibit 10.18

COMPANY TO PHOTRONICS SUPPLY AGREEMENT

     THIS COMPANY TO PHOTRONICS SUPPLY AGREEMENT is made and entered into as of May 5, 2006 (the "Effective Date"), by and between MP Mask Technology Center, LLC, a Delaware limited liability company (the "Company"), and Photronics, Inc., a Connecticut corporation ("Photronics"). The Company and Photronics are hereinafter collectively referred to as the "Parties" and individually as a "Party."

RECITALS

     WHEREAS, pursuant to the Limited Liability Company Operating Agreement of the Company of the same Effective Date herewith (the "Operating Agreement"), by and between Micron Technology, Inc. ("Micron") and Photronics, Micron and Photronics have formed the Company for the purpose of developing, producing and manufacturing photomasks and prototypes for photomasks ("Products");

     WHEREAS, Micron and Photronics have entered into a technology license agreement of the same Effective Date herewith (the "Technology License Agreement"), under which the necessary technology has been licensed to the Company in order for it to fulfill its obligations under this Agreement;

     WHEREAS, Micron and Photronics have entered into a separate supply agreement of the same Effective Date herewith (the "Photronics to Micron Supply Agreement"), which details the terms under which Photronics will supply to Micron the products it has purchased from the Company under this Agreement; and

     WHEREAS, Photronics and the Company desire to enter into this Agreement so that Photronics may purchase the products manufactured by the Company;

     NOW, THEREFORE, in consideration of the mutual representations, warranties, covenants and other terms and conditions contained herein, the Parties hereby agree as follows:

1. DEFINITIONS; INTERPRETATION

     For purposes of this Agreement, the definitions set forth in this Section 1 shall apply to the respective capitalized terms. All capitalized terms not defined herein shall have the meaning set forth in the Operating Agreement.

     1.1 "Company Location" shall mean the Company's photomask production facility located at [****].

     1.2 "Cost" shall have the meaning set forth in Schedule 5.1

     1.3 "Dead-on-Arrival" shall mean any Products that are discovered to contain a Material Defect within thirty (30) calendar days after receipt of shipment of the Product.

     1.4 "Entity" means a corporation, partnership, limited liability company, unincorporated organization, business association, firm, joint venture or other legal entity.

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     1.5 "Fiscal Month" shall mean a fiscal month of Micron.

     1.6 "Fiscal Quarter" shall mean a fiscal quarter of Micron.

     1.7 "Loading Requirement" shall have the meaning defined in the Photronics to Micron Supply Agreement.

     1.8 "Material Defect" shall mean any malfunction, error or other defect in a Product that constitutes a material nonconformity with the Specifications for such Product under conditions of normal and proper use.

     1.9 "Micron Supply Agreement" shall mean the Company to Micron Supply Agreement of the same Effective Date herewith, by and between Micron and the Company.

     1.10 "Micron's Specifications" shall mean the specifications provided by Micron for each Product in accordance with Micron's photomask ordering procedures and node requirements.

     1.11 "Product" or "Products" means photomasks and photomask prototypes that are to be manufactured by the Company or Photronics in accordance with Micron's Specifications and requirements or in accordance with a Photronics' customer's specifications and requirements, as applicable.

     1.12 "Purchase Order" shall mean a written purchase order that is delivered to the Company in accordance with Section 3.2.

     1.13 "Qualified" shall have the meaning set forth in the Technology License Agreement.

     1.14 "Specifications" shall mean the specifications provided by Photronics to the Company for each Product in accordance with Photronics' photomask ordering procedures and node requirements.

     1.15 "Technology License Agreement" shall mean the Technology License Agreement of the same effective date herewith, by and among Micron, Photronics and the Company.

2. PURCHASES; MANUFACTURE AND SUPPLY; FORECASTS

     2.1 Photronics Purchases. Photronics shall purchase Products from the Company in accordance with the terms and conditions of this Agreement. Subject to the terms of this Agreement and the Operating Agreement, Photronics may subcontract to the Company the manufacture of Product for which it has received purchase orders (x) from Micron pursuant to the Photronics to Micron Supply Agreement and (y) from other customers of Photronics, and will purchase Product manufactured by the Company at the purchase price set forth in Section 5.1.

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     2.2 Company Manufacture and Supply of Product; Micron Purchases. Except as set forth in this paragraph, the Photronics to Micron Supply Agreement and the Micron Supply Agreement, the Company shall sell Product to Photronics for resale to Micron and other customers of Photronics and shall not sell Products manufactured by the Company directly to Micron. In addition, in the event Photronics is (i) in default of any of its material obligations under any of the Transaction Documents, or (ii) unable, unwilling or otherwise fails, for any or no reason, to become or remain Qualified with respect to any Product, then notwithstanding any other provision herein or in the Photronics to Micron Supply Agreement, Micron may purchase Products directly from the Company, at the Company's actual documented cost and in accordance with the terms of this Agreement, until Photronics (a) cures any default hereunder or (b) demonstrates, to Micron's reasonable satisfaction, that it can and does meet Micron's specified qualification requirements with respect to Products, as applicable.

     2.3 Forecasts. [****].

     2.4 Capacity Commitment. [****].

3. PURCHASE ORDERS

     3.1 Purchase Orders. Photronics shall purchase Products from the Company by issuing a Purchase Order or a release to a blanket Purchase Order that references this Agreement. Photronics and the Company agree that a Purchase Order sent to the Company by confirmed facsimile or electronic transmission shall constitute a writing for all legal purposes. All Purchase Orders submitted to the Company shall be governed by the terms of this Agreement. Nothing contained in any Purchase Order or the Parties' other documents of purchase or sale shall in any way modify the terms of purchase or add any additional terms or conditions except as specifically agreed in writing by the parties.

     3.2 Acknowledgment of Purchase Orders. The Company shall notify Photronics of the receipt and acceptance of a Purchase Order and of the accepted delivery date for accepted orders within two (2) business days after receipt of the Purchase Order and any Purchase Order not specifically rejected in writing by the Company during such period shall be deemed accepted hereunder. The Company may not reject a Purchase Order or release issued in compliance with this Agreement and seeking delivery of Products within Forecasted amounts and established lead times.

     3.3 Revision of Purchase Orders. Photronics shall have the right, without charge, to issue change orders to Purchase Orders by providing written notice to the Company prior to the beginning of the production of the Product impacted by such change order. The Company shall use all commercially reasonable efforts to accommodate Photronics' revised Purchase Order in accordance with the Company's lead times in effect at the time the Purchase Order change is requested.

     3.4 Cancellations. [****].

     3.5 Reschedules. Photronics may reschedule the delivery of any Purchase Order or portion thereof for Products, without charge upon notice to the Company.

4. SHIPPING; DELIVERY; ACCEPTANCE

     4.1 Packaging Requirements. All shipments shall be in packaging that complies with the Specifications and, if applicable, Micron's packaging requirements. In addition, all shipments shall be accompanied by a detailed packing list which will reference the Products, Purchase Order number, and the quantity in each shipment covered by the packing list.

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     4.2 Shipping. The Company shall ensure that Product orders are delivered on the applicable delivery date(s). Orders will be shipped to the delivery address set forth in the applicable Purchase Order.

     4.3 Delivery. The Company's liability for delivery shall cease and title and all risk of loss or damage shall transfer to Photronics when the Product is delivered to Photronics' or its customer's designated receiving facility, as specified in the Purchase Order. Photronics or its customer shall be the importer of record and pay all related duties, fees and charges. The Company shall immediately notify Photronics in writing of any anticipated delay in meeting the delivery schedule, stating the reasons for the delay. No shipment will be deemed complete until all ordered units have been delivered.

     4.4 Dead on Arrival. In the event that any Product is found by Photronics or Micron to be Dead-on-Arrival, the Company shall use reasonable efforts consistent with the Company's practices to ship, at the Company's sole expense, a replacement Product to the site designated by Photronics or Micron within fourteen (14) business days of receipt of notice from Photronics or Micron and Photronics or Micron shall return the Dead-on-Arrival Product in accordance with the Product return procedures described under Section 6.2.

5. PRICE; PAYMENTS; TAXES; AUDIT

     5.1 Purchase Price for Products. The purchase price for each Product purchased by Photronics from the Company shall be the Company's cost of the Product as set forth in Schedule 5.1.

     5.2 Payments Terms. The Company shall provide an invoice to Photronics with an estimated price upon the shipment of Product hereunder. Each such invoice shall specify the Purchase Order for each Product and the estimated price per photomask. After each Fiscal Month end, the Company shall provide Photronics with a final invoice and Photronics' payment obligation shall be calculated from the date of Photronics' receipt of such invoice. Unless otherwise agreed by the Parties, payments for Product delivered in accordance with Section 4, and any other payments required hereunder, shall be made within thirty (30) days after the receipt of the final invoice. Payment does not constitute acceptance. In no event shall the Company deliver an invoice before shipping the Products to which such invoice relates. All amounts payable by Photronics to the Company shall be paid in U.S. Dollars.

     5.3 Taxes. All amounts payable for Product sold by the Company to Photronics hereunder are exclusive of any taxes. Photronics shall be responsible for and shall pay any applicable sales, use, excise or similar taxes, including value added taxes and customs duties due on the importation of Products and arising from purchases made by Photronics under this Agreement, excluding any taxes based on the Company's income. All such taxes shall be determined based upon the final shipment designation of the items identified on the invoice.

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     5.4 Audit of Books and Records. Upon Photronics' request from time to time (not to exceed two (2) times per year), Photronics shall have the right to perform an audit of the Company's books and records to verify its compliance with the terms and conditions of this Agreement. In the event an audit reveals an overpayment by Photronics, the Company shall immediately issue a refund to Photronics for any such overpayment. Any audit performed hereunder shall be performed in a manner that ensures compliance with all applicable Laws and confidentiality requirements.

     5.5 Inspection of Company Location. Upon Photronics' reasonable request from time to time, Photronics shall have the right to perform a reasonable inspection of the Company's Location, as necessary to verify that the facility meets Micron's Specifications and requirements. In the event an inspection of the Company's Location reveals any deficiency in meeting Micron's Specifications and requirements, the Company shall promptly take action to remedy such deficiency.

6. WARRANTIES

     6.1 Company Product Warranty. [****]. This warranty does not apply to any Product failures resulting from any misuse, abuse, neglect, alteration, modification, improper installation of or repairs to the Product by anyone other than the Company.

     6.2 Remedies. In the event that Photronics or Micron notifies the Company during the applicable Warranty Period that any Product does not conform to the warranty provisions set forth in Section 6.1, the Company shall, at its option, (a) replace such defective Product at no cost to Photronics or Micron, as applicable, in accordance with the Company's Product return material authorization procedures within ten (10) days of the Company's receipt of the defective Product, (b) repair such defective Product at no cost to Photronics or Micron, as applicable, or (c) provide a refund of any amounts paid by Photronics or Micron, as applicable, for such defective Product. The Company shall bear all packing, transportation, insurance and other costs incurred in connection with the replacement or repair of defective Products. Except for resulting personal injury or property damage, this paragraph states the exclusive remedy of Photronics for failure of any Product to conform to the warranty provisions set forth in Section 6.1.

     6.3 No Warranty Pass Through. Photronics shall have the right to make Product warranties to its customers consistent with the Product warranty made by the Company under this Agreement. Photronics hereby indemnifies and holds the Company harmless from and against any liabilities, losses, damages, costs and expenses, including attorneys' fees and costs, incurred by the Company resulting from any claims based on or related to any representation or warranty made by Photronics regarding the Products that is inconsistent with the warranty made by the Company hereunder.

     6.4 Disclaimer. EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT, NEITHER PARTY MAKES (AND EACH PARTY HEREBY EXPRESSLY DISCLAIMS) ANY REPRESENTATIONS OR WARRANTIES, WHETHER EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE OR NON-INFRINGEMENT, AND ANY WARRANTIES THAT MAY ARISE FROM COURSE OF PERFORMANCE, COURSE OF DEALING OR USAGE OF TRADE.

5

**** Material omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Exchange Act of 1934. Material filed separately with the Securities and Exchange Commission.

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7. CONFIDENTIAL INFORMATION

     7.1 Protection and Use of Confidential Information. All information provided, disclosed or obtained in connection with this Agreement or the performance of either of the Parties' activities under this Agreement shall be subject to all applicable provisions of the Nondisclosure Agreement. Furthermore, the terms and conditions of this Agreement shall be considered "Confidential Information" under the Nondisclosure Agreement for which each Party is considered a "Receiving Party" under such agreement. To the extent there is a conflict between this Agreement and the Nondisclosure Agreement, the terms of this Agreement shall control. For purposes of this Section 7.1 only, Micron shall be considered a "Party." If the Nondisclosure Agreement is terminated or expires and is not replaced, such Nondisclosure Agreement shall continue with respect to confidential information provided in connection with this Agreement, notwithstanding such expiration or termination, for the duration of the Initial Term and any and all extension periods or until a new nondisclosure agreement is entered into between the Parties.

8. LIMITATION OF LIABILITY. [****], IN NO EVENT WILL EITHER PARTY BE LIABLE TO THE OTHER PARTY OR ANY THIRD PARTY CLAIMING THROUGH OR UNDER EACH SUCH PARTY, FOR ANY LOST PROFITS, LOST DATA, EQUIPMENT DOWNTIME, OR FOR ANY INDIRECT, INCIDENTAL, SPECIAL OR CONSEQUENTIAL DAMAGES, WHETHER IN AN ACTION IN CONTRACT OR TORT, BASED ON A WARRANTY, OR OTHERWISE, ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT, EVEN IF EACH SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. [****]. Each Party acknowledges that the foregoing limitations are an essential element of the Agreement between the Parties and that in the absence of such limitations the pricing and other terms set forth in this Agreement would be substantially different. Each Party shall have a duty to mitigate any damages hereunder in accordance with applicable law.

9. TERM AND TERMINATION

     9.1 Term. This Agreement will be effective as of the Effective Date, and shall remain in force for ten (10) years (the "Initial Term").

     9.2 Termination for Breach. The Company may terminate this Agreement in the event that Photronics materially breaches any of the provisions of this Agreement or the Photronics to Micron Supply Agreement and does not cure such material breach within ninety (90) days following receipt of notice of such breach. Provided that if the breach is capable of being cured and the breaching Party has worked diligently and in good faith since the receipt of the notice to cure such breach, the cure period will be extended for an additional thirty (30) days.

     9.3 Cross-Termination. Unless otherwise expressly agreed in writing by the parties, this Agreement shall automatically terminate upon the dissolution of the Company or the termination of the Operating Agreement or the Photronics to Micron Supply Agreement.

6

**** Material omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Exchange Act of 1934. Material filed separately with the Securities and Exchange Commission.

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     9.4 Effect of Termination.

          9.4.1 Continuing Liability. The termination of this Agreement for any reason shall not release either party from any liability, obligation or agreement which has already accrued at the time of termination. Termination of this Agreement for any reason shall not constitute a waiver or release of, or otherwise be deemed to prejudice or adversely affect, any rights, remedies or claims, whether for damages or otherwise, which a party may have hereunder, at law or otherwise, or which may arise out of or in connection with such termination.

          9.4.2 Outstanding Purchase Order Fulfillment. The Company shall complete all Purchase Orders that have been previously accepted by the Company and not specifically cancelled upon termination by Photronics or Micron and shall accept and fulfill any Purchase Orders issued by Photronics or Micron for a period of [****] after termination of this Agreement, provided that the reason for termination was not a failure by Photronics to pay amounts previously due to the Company under this Agreement.

          9.4.3 Payment Obligation. Photronics shall pay for all Products previously delivered by the Company and all Products subsequently delivered by the Company pursuant to the Purchase Orders referred to in Section 9.4.2.

     9.5 Survival. The provisions of Sections 5.3, 6, 7, 8, 9.4, 9.5 and 10 shall survive any termination of this Agreement.

10. MISCELLANEOUS TERMS

     10.1 Amendments. This Agreement may not be amended without the prior written consent of both parties.

     10.2 No Waiver. Any provision of this Agreement may be waived if, and only if, such waiver is in writing and is duly executed by the party against whom the waiver is to be enforced. No failure or delay by any party in exercising any right, power or privilege under this Agreement shall operate as a waiver thereof nor shall any single or partial waiver or exercise thereof preclude the enforcement of any other right, power or privilege.

     10.3 Notices and Other Communications. All notices required or permitted under this Agreement shall reference this Agreement and will be deemed given: (a) when sent by confirmed facsimile; (b) five (5) business days after having been sent by registered or certified mail, return receipt requested, postage prepaid; or (c) three (3) business days after deposit with an internationally recognized commercial overnight carrier specifying next-day delivery, with written verification of receipt. All such notices, requests, demands and other communications shall be addressed as follows:

7

**** Material omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Exchange Act of 1934. Material filed separately with the Securities and Exchange Commission.

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         If to the Company:

         MP Mask Technology Center, LLC
         3851 East Columbia Road
         Boise, Idaho 83716
         Attention: General Manager
         Facsimile: (208) 363-5099

         If to Photronics:

         Photronics, Inc.
         15 Secor Road
         Brookfield, CT 06804
         Attention: Edwin L. Lewis, Senior Vice President and General Counsel
         Facsimile: (203) 775-5601

         and

         Photronics, Inc.
         15 Secor Road Brookfield, CT 06804
         Attention: Sean Smith, Senior Vice President and Chief Financial Officer
         Facsimile: (203) 775-5601

or to such other address or facsimile number as a Party may have specified to the other Parties in writing delivered in accordance with this Section 10.3.

     10.4 Governing Law. This Agreement will be governed by and construed in accordance with the laws of the State of Delaware, United States of America, as applied to agreements among Delaware residents entered into and wholly to be performed within the State of Delaware (without reference to any choice or conflicts of laws rules or principles that would require the application of the laws of any other jurisdiction).

     10.5 Construction; Interpretation.

          10.5.1 Certain Terms. The words "hereof," "herein," "hereunder" and similar words refer to this Agreement as a whole and not to any particular provision of this Agreement. The term "including" is not limited and means "including without limitation."

          10.5.2 Section References; Titles and Subtitles. Unless otherwise noted, all references to Sections and Schedules herein are to Sections and Schedules of this Agreement. The titles, captions and headings of this Agreement are inserted for convenience of reference only and are not intended to be a part of or to affect the meaning or interpretation of this Agreement.

          10.5.3 Reference to Persons, Agreements, Statutes. Unless otherwise expressly provided herein, (i) references to a Person include its successors and permitted assigns, (ii) references to agreements (including this Agreement) and other contractual instruments shall be deemed to include all subsequent amendments, restatements and other modifications thereto or supplements thereof and (iii) references to any statute or regulation are to be construed as including all statutory and regulatory provisions consolidating, amending, replacing, supplementing or interpreting such statute or regulation.

8

**** Material omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Exchange Act of 1934. Material filed separately with the Securities and Exchange Commission.

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          10.5.4 Presumptions. No party, nor its counsel, shall be deemed the drafter of this Agreement for purposes of construing the provisions of this Agreement, and all provisions of this Agreement shall be construed in accordance with their fair meaning, and not strictly for or against any party.

     10.6 Rights and Remedies Cumulative. All remedies provided for in this Agreement shall be cumulative and in addition to and not in lieu of any other remedies available to any Party at law, in equity or otherwise.

     10.7 No Assignment; Binding Effect. Except as otherwise expressly provided in this Agreement, neither Party may assign, delegate or otherwise transfer any of its rights or obligations hereunder to any third party, whether by assignment, transfer, Change in Control, or other means, without the prior written consent of the other Party; provided, however, that this Agreement may be assigned in connection with a Permitted Photronics Change of Control if Micron does not elect to exercise its purchase rights pursuant to Section 7.4.2 of the Operating Agreement. Any attempted assignment in violation of the foregoing shall be null and void. Subject to the foregoing, this Agreement shall be binding on and inure to the benefit of the Parties, their heirs, executors, administrators, and successors.

     10.8 Relationship of the Parties. In the exercise of their respective rights and the performance of their respective obligations hereunder the Parties are, and will remain independent contractors. Nothing in this Agreement will be construed to constitute the Parties as partners or principal and agent for any purpose whatsoever. Neither Party will bind, or attempt to bind, the other Party hereto to any contract or other obligation, and neither Party will represent to any third party that it is authorized to act on behalf of the other Party to this Agreement.

     10.9 Severability. If any provision in this Agreement will be found or be held to be invalid or unenforceable, then the meaning of said provision will be construed, to the extent feasible, so as to render the provision enforceable, and if no feasible interpretation would save such provision, it will be severed from the remainder of this Agreement which will remain in full force and effect unless the severed provision is essential and material to the rights or benefits received by any party. In such event, the Parties will use their respective best efforts to negotiate, in good faith, a substitute, valid and enforceable provision or agreement which most nearly effects the Parties' intent in entering into this Agreement.

     10.10 Execution. This Agreement may be executed in counterparts, each of which so executed will be deemed to be an original and such counterparts together will constitute one and the same agreement. Execution and delivery of this Agreement by exchange of facsimile copies bearing the facsimile signature of a Party shall constitute a valid and binding execution and delivery of this Agreement by such Party.

9

**** Material omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Exchange Act of 1934. Material filed separately with the Securities and Exchange Commission.

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     10.11 Force Majeure. Neither Party shall be deemed in default if its performance or obligations hereunder are delayed or become impossible or impractical due to causes beyond its reasonable control, including acts of God, war, fire, earthquake, and acts of civil or military authority. Force majeure events shall not include delays in transportation, shortages of material or delays by subcontractors or suppliers, unless such delay by a subcontractor or a supplier was caused by an event that would qualify as a force majeure event under this Section 10.11. Under no circumstances shall economic considerations or economic impossibilities or inefficiencies delay performance or be considered a force majeure. The time for performance of any such obligation shall be extended for the time period lost by reason of the delay.

     10.12 Dispute Resolution. The parties hereby agree that claims, disputes or controversies of whatever nature, arising out of, in connection with, or in relation to the interpretation, performance or breach of this Agreement (or any other agreement contemplated by or related to this Agreement), shall be resolved in accordance with the dispute resolution procedures set forth in Section 11.3 of the Operating Agreement.

     10.13 Entire Agreement. This Agreement, together with the other documents, exhibits and schedules referred to herein and therein, constitute the entire agreement among the parties hereto pertaining to the subject matter hereof, and supersede any and all prior oral and written, and all contemporaneous oral, agreements or understandings pertaining thereto. There are no agreements, understandings, restrictions, warranties or representations relating to such subject matter between the parties other than those set forth herein and in the other documents, exhibits and schedules referred to herein and therein.

     10.14 No Third Party Beneficiaries. The terms and provisions of this Agreement are intended solely for the benefit of the Parties and their respective successors and permitted assigns, and the Parties do not intend to confer third party beneficiary rights upon any other Entity or person. Notwithstanding the foregoing, Micron shall be deemed a third party beneficiary to the extent it purchases Product directly from the Company pursuant to Section 2.2 and shall have the right to directly enforce the obligations of the Company set forth in Sections 2.2, 4, 6 and 9.4.2 against the Company.

[Signature Page Follows]

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**** Material omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Exchange Act of 1934. Material filed separately with the Securities and Exchange Commission.

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     IN WITNESS WHEREOF, the Parties hereto have duly executed this Agreement as of the day and year first above written.

**** Material omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Exchange Act of 1934. Material filed separately with the Securities and Exchange Commission.

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SCHEDULE 5.1

PRODUCT COST

[****]

 

 

 

**** Material omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Exchange Act of 1934. Material filed separately with the Securities and Exchange Commission.

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Exhibit 21

SUBSIDIARIES OF PHOTRONICS, INC.

		State or Jurisdiction
		of Incorporation or Organization
Align-Rite International, Inc.			(California, USA)
Align-Rite, Inc.			(Florida, USA)
Align-Rite International, Ltd.			(United Kingdom)
Photronics (Wales) Limited			(United Kingdom)
Photronics, B.V.			(Netherlands)
Photronics Arizona, Inc.			(Arizona, USA)
Photronics California, Inc.			(California, USA)
Photronics Idaho, Inc.			(Idaho, USA)
Photronics Texas, Inc.			(Texas, USA)
Photronics Texas I, LLC			(Delaware, USA)
Photronics Texas I, LP (1)			(Texas, USA)
Photronics Texas Allen, Inc.			(Texas, USA)
Photronics Texas II, LLC			(Delaware, USA)
Photronics Texas II, LP (2)			(Texas, USA)
Photronics MZD, GmbH			(Germany)
Photronics Imaging Technologies (Shanghai) Co., Ltd.			(China)
Photronics Semiconductor Mask Corporation (3)			(Taiwan, R.O.C.)
Photronics Switzerland, S.a.r.L			(Switzerland)
Photronics Singapore Pte, Ltd.			(Singapore)
Photronics UK, Ltd.			(United Kingdom)
Photronics France SAS (4)			(France)
PK, Ltd. (5)			(Korea)
PKLT			(Taiwan)
Trianja Technologies, Inc.			(Texas, USA)

(1)		99.0% owned by Photronics Texas I, LLC, and 1.0% owned by Photronics Texas, Inc. (directly and indirectly, in the aggregate, wholly owned by Photronics, Inc.).
(2)		99.0% owned by Photronics Texas II, LLC., and 1.0% owned by Photronics Texas Allen, Inc. (directly and indirectly, in the aggregate, wholly owned by Photronics, Inc.).
(3)		62.25% owned by Photronics, Inc.
(4)		99% owned by Photronics UK, Ltd., and 1% owned by Photronics MZD, GmbH (directly and indirectly, in the aggregate, wholly owned by Photronics, Inc.).
(5)		79.98% owned by Photronics, Inc., and 19.71% owned by Photronics Singapore Pte Ltd.

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EXHIBIT 23

Consent of Independent Registered Public Accounting Firm

     We consent to the incorporation by reference in Registration Statement Nos. 333-160235 and 333-161857 on Form S-3 and Registration Statement Nos. 333-02245, 333-42010, 333-50809, 333-86846, 33-78102, 333-151763, 333-169295 and 333-169296 on Form S-8 of our reports dated January 12, 2012 relating to the consolidated financial statements and financial statement schedule of Photronics, Inc. and subsidiaries and the effectiveness of Photronics, Inc. and subsidiaries internal control over financial reporting appearing in this Annual Report on Form 10-K of Photronics, Inc. and subsidiaries for the year ended October 30, 2011.

/s/Deloitte & Touche LLP
Hartford, Connecticut
January 12, 2012

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EXHIBIT 31.1

I, Constantine S. Macricostas, certify that:

1.		I have reviewed this Annual Report on Form 10-K of Photronics, Inc.
2.		Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report.
3.		Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report.
4.		The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
		a)		designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
		b)		designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
		c)		evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this annual report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this annual report based on such evaluation; and
		d)		disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.		The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
		a)		all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
		b)		any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

/s/ CONSTANTINE S. MACRICOSTAS

Constantine S. Macricostas

Chief Executive Officer

January 12, 2012

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EXHIBIT 31.2

I, Sean T. Smith, certify that:

1.		I have reviewed this Annual Report on Form 10-K of Photronics, Inc.
2.		Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report.
3.		Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report.
4.		The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
		a)		designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
		b)		designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
		c)		evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this annual report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this annual report based on such evaluation; and
		d)		disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.		The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
		a)		all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
		b)		any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

/s/ SEAN T. SMITH

Sean T. Smith

Chief Financial Officer

January 12, 2012

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EXHIBIT 32.1

Section 1350 Certification of the Chief Executive Officer

I, Constantine S. Macricostas, Chief Executive Officer of Photronics, Inc. (the "Company"), certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that:

(1)		the Annual Report on Form 10-K of the Company for the year ended October 30, 2011 (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2)		the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ CONSTANTINE S. MACRICOSTAS

Constantine S. Macricostas

Chief Executive Officer

January 12, 2012

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EXHIBIT 32.2

Section 1350 Certification of the Chief Financial Officer

I, Sean T. Smith, Chief Financial Officer of Photronics, Inc. (the "Company"), certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that:

(1)		the Annual Report on Form 10-K of the Company for the year ended October 30, 2011 (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2)		the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ SEAN T. SMITH

Sean T. Smith

Chief Financial Officer

January 12, 2012

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